Next WTO Chief Warns of Recession
KUALA LUMPUR, Malaysia (AP) _ The next head of the World Trade Organization said Tuesday that a global recession is likely to occur.
``I would say for the whole year next year, we should brace ourselves for a period of global recession,″ said Supachai Panitchpakdi, director-general designate of the Geneva-based trade body.
Supachai said that inventories of information technology products are unlikely to be exhausted until the fourth quarter of 2002, when demand for electronic products may begin to spur economic recovery.
Supachai, speaking at a private economic conference, said that most countries have already adjusted their economic forecasts for 2002 downward. He said those forecasts, however, do include some optimism for economic recovery.
``I think we should be cautious of that kind of projection,″ he said.
Supachai, who will become director general of the WTO in 2002, said there is a lack of financial reforms in Asia and ``mountains of non-performing loans″ that will take time to resolve.
He said that governments have taken over large quantities of private sector debt and must remain vigilant about reducing it.