GLOBAL AND REGIONAL ECONOMIC DEVELOPMENTS AND OUTLOOK: RISKS AND ISSUES
HARJOWIRYONO, MARWANTO, DKK
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Four speakers have shared their thoughtful views to the meeting . The IMF informed the meeting that the pick up in the global growth that began in mid -2003 showed some moderation in the second quarter 2004, caused by the rising of oil price and some softening in several developed countries. Other risk that may challenge the global economic outlook is the twin US deficits. The IMF came up some suggestions of approapriate policy response to face those challenges. The US delegated briefed the meeting on the economic recovery in the US. After having some slow down in previous period, the economic growth seems to rebound and improving in the beginning of second half 2004. The US also explained the causes and possible measures in facing the twin deficits issue. The government has astrong commitment to reduce the fiscal deficit and tries to addres the current account deficit by improving the domestic saving lebel through tax reform . At the same time, the current account deficit needs to be supported by improvement of investment environment in Europe, as well as fair exchange rate realignment throughtout the world.