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IMF seeks UK defer of spending cuts if growth disappointment persist

Tuesday, 09 October 2012
As the British economy continues to sink, the IMF, International Monetary Fund has called Britain to defer spending cuts planned for next year. This should happen if growth turns out to be much weaker than forecast.

The IMF said Britain's deficit-cutting plans were already behind forecast, but that Chancellor George Osborne should be prepared to slow them further in the short term if other measures failed to boost demand.

But the British government insist that they will stick to their so called deficit reduction program - a program that has seen British deficit increased since the current coalition took power some three years ago.

The British Prime minister David Cameroon told a told radio, London Biggest conversation that his government will continue with their program to seek means on how to improve the business sectors while continue to cut heavily on welfare programs such as housing and child benefits.

The IMF's budget assessment of the UK economic situation came hours after it sharply downgraded Britain's growth outlook, predicting the economy would shrink 0.4 percent this year, before growing by a tepid 1.1 percent in 2013.

Though the reports will make uncomfortable reading for George Osborne, who has been referring to the IMF's visa of his program of austerity management, will unveil updated growth and budget forecasts on December 5.

The general consensus among many economists is that George Osborne will struggle to meet his goals of eliminating the structural budget deficit within five years, and putting net debt as a share of GDP on a downward path by 2015.
By Scancomark.com Team