Global Recovery Advances but Remains Uneven
The two-speed recovery continues. In advanced economies, activity has moderated less than
expected, but growth remains subdued, unemployment is still high, and renewed stresses in the
euro area periphery are contributing to downside risks. In many emerging economies, activity
remains buoyant, inflation pressures are emerging, and there are now some signs of overheating,
driven in part by strong capital inflows. Most developing countries, particularly in sub-Saharan
Africa, are also growing strongly. Global output is projected to expand by 4� percent in 2011
(Table 1 and Figure 1), an upward revision of about � percentage point relative to the October
2010 World Economic Outlook (WEO). This reflects stronger-than-expected activity in the
second half of 2010 as well as new policy initiatives in the United States that will boost activity
this year. But downside risks to the recovery remain elevated. The most urgent requirements for
robust recovery are comprehensive and rapid actions to overcome sovereign and financial
troubles in the euro area and policies to redress fiscal imbalances and to repair and reform
financial systems in advanced economies more generally. These need to be complemented with
policies that keep overheating pressures in check and facilitate external rebalancing in key
emerging economies