IMF’s Lipsky: Global recovery strengthening, fragile

Saturday, 21 May 2011 00:00 - - {{hitsCtrl.values.hits}}

(Reuters) - The global economic recovery is accelerating but remains vulnerable to setbacks, IMF acting Managing Director John Lipsky said, as he urged continued international support for shaky economies in Europe.

“The global recovery is gaining strength. But it remains fragile and uneven, and beset by uncertainties,” he said a meeting of the Bretton Woods group, a private sector advisory group to the International Monetary Fund and World Bank.

Lipsky expressed chagrin at having to deliver remarks in lieu of the disgraced Dominique Strauss-Kahn, who resigned as IMF managing director overnight as he faces sexual assault charges in New York.

“I deeply regret the circumstances that have made it necessary for me to substitute for Dominique Strauss-Kahn,” Lipsky said in remarks prepared for delivery to the Bretton Woods annual meeting.

Lipsky said European nations that are in critical economic condition as a result of sovereign debt crises deserve international support.

“There are compelling reasons for their European neighbors and the global community -- through the IMF -- to support these countries’ reform efforts,” he said.

“The only viable option for Europe today is a solution that is comprehensive and consistent -- and that is also cooperative and shared,” he added.

He also said emerging market countries concerned about stemming a potentially volatile surge of capital into their economies might be justified on occasion in erecting capital controls.