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Last Updated: Thursday, 18 January 2007, 08:06 GMT
IMF boss hails European economies
Rodrigo de Rato
Mr de Rato said Europe's recovery was not without its risks
The head of the International Monetary Fund (IMF) has praised Europe's strong economic growth but warned of the dangers of protectionism.

Rodrigo de Rato said Europe's economic upturn in recent months, led by Germany and France, was a major boost for the global economy.

But he said efforts must be made to conclude a global trade treaty and to reduce levels of unemployment.

He called for renewed reform efforts to deregulate eurozone labour markets.

Risks

Although the eurozone was expected to see growth above 2% in 2007 and 2008, Mr de Rato said the spectre of protectionism and higher levels of unemployment compared with the US threatened the turnaround.

"We are seeing a long-awaited pickup in investment and employment in Europe," he said in a speech in the US.

"Of course, there are risks to this benign outlook," he added.

"One that is particularly troubling is a possible resurgence of protectionism.

"Government and citizens all around the world, including Europe, should be very concerned about the negotiations in the Doha round."

Trade ministers from the EU, US and developing countries are meeting in Davos later this month to try and kick-start global trade talks which have been stalled for six months.


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