Moreover, unlike the West, which has used up most of its traditional countercyclical policy ammunition, China has maintained ample scope for fiscal and monetary policy adjustments as circumstances dictate.

According to the IMF, real output in advanced countries this year will still be below 2007 levels, whereas it will be 16 higher in emerging and developing countries.

But the Iranian budget is now running a 15 of GDP deficit, and foreign reserves are shrinking, despite the oil boom.

India s foreign exchange reserves stand at 278 billion (about 15 of GDP), enough to finance the entire current account deficit for several years.

But the most recent RRR increases serve mainly to sterilize the passive money supply caused by the increase in foreign exchange reserves.

The IMF s explanation of the recent fall in China s current account surplus GDP ratio is broadly correct.

The International Monetary Fund estimates that this form of value added tax could bring in between 0.5 and one percentage point of GDP in revenue.

The IMF estimates that these cyclical effects on revenue and outlays have raised the overall deficit by nearly 5 of Greek GDP.

The dominant mode of thought within the Federal Reserve with which I agree appears to be that the information technology revolution is continuing, that the pace of growth of potential output in the US remains very fast, and that the output gap is thus relatively wide.

In response to this trend, the IMF urges a return to pre crisis debt to GDP ratios.

The IMF also reckons that the advanced countries must cut spending or increase taxes by nine percentage points of GDP on average over the current decade, in order to bring the public debt ratio to 60 of GDP by 2030.

The International Monetary Fund forecasts 5.5 GDP growth in sub Saharan Africa in 2011, and 6 growth in 2012.

According to the IMF, China s annual GDP growth has slowed to 8 , from 10 in 2010 over the same period, India s growth rate slowed from 11.2 to 5.7 .

Reflecting these reforms, the International Monetary Fund recently projected that Italy will have a cyclically adjusted budget surplus of nearly 1 of GDP in 2013.

The International Monetary Fund (IMF) reported on the fiscal crisis thus the Palestinian Authority's deficit rose from 14 per cent to 17 per cent of gross domestic product (GDP) in the past year, and may well reach 19 per cent of GDP in 2006.

By late July 2004, foreign exchange reserves had risen to US 4.6 billion, external debt had been brought down to 68 per cent of GDP and inflation had been contained.

The IMF estimates that every increase of ten percentage points in the debt to GDP ratio reduces long term growth by a quarter of a percentage point.

According to the International Monetary Fund, the challenge of reducing the public debt GDP ratio to a safe level is daunting for most advanced countries.

The International Monetary Fund estimates that China s current account surplus will narrow to just 2.3 of GDP in 2012, after peaking at 10.1 in 2007.

Despite cuts in government spending and increases in taxes, the IMF still projects the cyclically adjusted fiscal deficit to exceed 3.2 of GDP in 2013 and 2.3 of GDP in 2015.

In April 2010, the International Monetary Fund s World Economic Outlook projected 1.8 annual GDP growth in Germany and the Netherlands in 2013.

By contrast, in China, the asset side of the state balance sheet is very large land, foreign currency reserves of 3.5 trillion, and around an 85 stake in state owned enterprises that account for about 40 of output.

Egypt s budget deficit reached 10 of GDP, while its foreign exchange reserves have fallen to 15 billion barely enough to cover the country s import bill for the next three months.

According to the International Monetary Fund, India s external deficit, for example, is likely to average 5 of GDP in 2012 2013, compared to 2.8 in 2008 2011.

According to the International Monetary Fund and others, these economies ratio of public debt to GDP will surpass 110 by 2015, compared to 70 before the crisis.

In its most recent WEO, the IMF forecasts global GDP to grow by only 3.3 in 2012, and by 3.6 in 2013.

This will raise actual output to the level of potential output, thereby closing the output gap.

Emerging economies many of which use large trade surpluses to drive GDP growth and supplement their foreign exchange reserves with the resulting capital inflows are leading buyers of US debt.

Because the private economy is now stronger, it may benefit from more auspicious growth conditions, but the magnitude of the fiscal retrenchment needed more than ten percentage points of GDP, according to the IMF is frightening.

No one wants to navigate the precarious government debt dynamic that Japan faces, with debt levels far above 100 of GDP (even if one factors in the Japanese government s vast holdings of foreign exchange reserves.)

In late June, the IMF projected modest growth, and, at the time of the bailout agreement in May 2011, GDP in 2013 was expected to grow by 1.25 .

Consider that a perpetuity growth rate exceeding the annualized growth of the S P 500 and or the U.S. GDP implies that the company's cash flow will outpace and eventually absorb these rather large values.

In the 2010 2011 fiscal year, the IMF estimates that economic output will increase by less than 3 one third the rate expected in neighboring India and less than half that of Bangladesh.

Others call for allocating Special Drawing Rights (SDR s) from the IMF, or for using the IMF s gold resources.

In May 2010, the International Monetary Fund projected presumably in concurrence with its European partners that Greece s annual GDP growth would exceed 1 in 2012.

Don t Fear the IMF

Japan s GDP share is about one third of Asia and 8 of the world.

According to IMF calculations, to reach a 60 debt ratio in 2030 would require a budgetary adjustment of almost nine percentage points of GDP on average between 2010 and 2020.

Yemen s GDP is only 10 the size of Greece s, representing 0.05 of global output, and its economy is not significantly linked to the international financial system.

Eight years of 7 average annual GDP growth during Putin s previous presidency (2000 2008) allowed Russia to repay its debts, accumulate almost 600 billion in foreign currency reserves, and join the leading emerging economies.

In 2007 (i.e., pre crash), the IMF reported that average GDP per head in the United States stood at 47,000, and at 46,000 in the UK.

In 2010, economic output was dominated by the service sector which accounted for 66 of GDP, followed by the industrial sector with 27.2 and agriculture accounting for 6.8 of GDP.

The G 20 has enough legitimacy for its purpose which is more limited than the purposes of formal institutions such as the UN, the International Monetary Fund, and the World Trade Organization by virtue of the fact that it accounts for 85 of the world s GDP, for example.

The real issue is the fiscal mountain. According to the International Monetary Fund, the challenge of reducing the public debt GDP ratio to a safe level is daunting for most advanced countries.

United Nations Industrial Development Organization