IMF says world is at risk of 'economic derailment'

Image source, AFP

Image caption, First deputy managing director of the IMF, David Lipton, centre, says the world is at a delicate juncture
  • Author, Karishma Vaswani
  • Role, Asia business correspondent

The International Monetary Fund (IMF) has warned that the global economy faces a growing "risk of economic derailment" and must take steps to boost global demand.

David Lipton, second in command at the IMF, outlined some of these risks in a speech to the National Association for Business Economics in Washington on Tuesday.

"The IMF's latest reading of the global economy shows once again a weakening baseline," he said. "We are clearly at a delicate juncture."

The comments come after weaker-than-expected trade figures from China showing that exports plunged by a quarter from a year ago.

The IMF has already said it is likely it will downgrade its current forecast of 3.4% for global growth when it next releases its economic predictions in April.

The dismal picture is one that has on-going ramifications for businesses and industries that bet on China's growth story.

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