IMF chief Christine Lagarde: Some EU countries in technical recession
The International Monetary Fund chief said today that some European countries may be technically in a recession but that does not necessarily apply to the 17-nation eurozone or the European Union.
At a news conference in Pretoria, the South African capital, Christine Lagarde warned 2012 "will not be a walk in the park, that will not be an easy journey."
"I think some European countries might be technically in a recession. Now whether that means the whole of the eurozone or the whole of Europe is in a recession, I don't think so," she said. She did not identify which countries might technically be in recession, which means they would have suffered two consecutive quarters of economic contraction.
"There is great variety within those two zones to probably justify neither of the eurozone nor the European Union would be in a recession — which does not mean to say that all members inside of those two zones would be immune to recession," she said.
Lagarde was accompanied by South Africa's Finance Minister Pravin Gordhan, who said the European situation was creating more and more uncertainty. He called for "an appropriate level of assertiveness" to help the world "move on a different path."
"The world is still in a dangerous phase if you like," Gordhan said. "It demands all governments maintain a high level of vigilance and that the IMF becomes even-handed and more vigilant itself, so that it can play its rightful role in maintaining global stability but also global growth."
Lagarde is on a three-day visit to South Africa, which boasts the largest economy on the continent.
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