Economy chiefs warn on growth, jobs and trade

GENEVA Fri Jan 20, 2012 9:49am EST

A general view shows the Swiss mountain resort of Davos January 16, 2012. The World Economic Forum (WEF) will take place in Davos from January 25 to 29.     REUTERS/Arnd Wiegmann

A general view shows the Swiss mountain resort of Davos January 16, 2012. The World Economic Forum (WEF) will take place in Davos from January 25 to 29.

Credit: Reuters/Arnd Wiegmann

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GENEVA (Reuters) - Economic growth, jobs and protectionism are the top three worries at the start of 2012, according to a "Call to Action" published by 11 leaders of international organizations on Friday in a bid to kick-start debate at next week's Davos Forum.

The signatories, including the heads of the World Bank, International Monetary Fund and World Trade Organization, comprise the "Global Issues Group" of the World Economic Forum, the Geneva-based organization that runs the exclusive annual networking shindig in the Swiss ski resort of Davos.

"While the global economy faces severe challenges, it can regain momentum by supporting the economic transformation underway in the emerging world by meeting the infrastructure needs around the globe and by beginning to realize the promise of a greener economy," they said.

They called for a "more comprehensive action plan" that could be agreed at the G20 summit in Mexico in June, and said countries could rebuild confidence by implementing proposed reforms and by increasing global cooperation.

The three-page list of issues and proposed solutions, which the group said did not necessarily reflect the views of their organizations, is unlikely to stir much controversy.

Their five-point plan for reigniting growth included restoring confidence in financial institutions, cutting deficits without cutting growth, addressing youth and long-term unemployment and using public-private partnerships to help countries finance investments without adding to deficits.

On the tricky issue of resolving the euro zone crisis, it recommended "continuing the European Central Bank's measures to secure bank funding and liquidity, enhancing the European Financial Stability Facility and European Stability Mechanism to ensure governments can fund at sustainable rates and implementing country-level fiscal packages to stabilize debt dynamics".

In the longer term, the 11 signatories said the world would need new sources of growth, financial sector reforms, open markets, low-carbon growth and efforts to create jobs and support the poor.

The signatories were Financial Stability Board chairman Mark Carney, World Health Organization chief Margaret Chan, OECD Secretary-General Angel GurrĂ­a, WTO director general Pascal Lamy, IMF chairwoman Christine Lagarde, World Bank president Robert Zoellick, and the leaders of the International Labour Organization, World Food Programme, and three regional development banks.

(Reporting by Tom Miles)

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