Merck 2010 Annual Report Download - page 101

The OECD expects an economic recovery, albeit one which will involve risks. For the near future
and for a sustainable recovery from the crisis, the OECD calls for governments to immediately
concern themselves with consolidating state finances in order to achieve more stability in the
financial markets. Moreover, it is essential to end the different economic stimulus programs
at the right time. The OECD expects that interest rates will not return to a normal level until
the first half of 2012, as it predicts weak growth in the United States and the eurozone. In
addition, the OECD is encouraging a shift in economic policy away from crisis management and
toward crisis prevention.
The growth prospects for emerging countries such as Brazil, China and India are significantly
better. Nevertheless, there is inflationary pressure in both Brazil and China, while India has to
contend with its tax deficit.
The IMF predicts global GDP to increase by 4.4% in 2011, yet warns against excessively low
consumer demand. The IMF forecasts a 2.5% increase in GDP for developed countries in 2011
(including a rise of 3.0% in the United States, 2.2% in Germany and 1.6% in Japan). For emerging
and developing countries, GDP is predicted to increase in 2011 by 6.5%, including a rise of
9.6% in China, 8.4% in India and 4.5% in Russia. According to IMF data, global GDP is predicted
to grow by 4.5% in 2012. The United States is expected to show GDP growth of 2.7% in 2012,
which is slightly lower than in 2011, Germany growth of 2.0%, which is also slightly lower, and
Japan growth of 1.8%, which is slightly higher than in 2011. At 4.4% and 9.5%, respectively,
GDP growth in Russia and China is expected to maintain almost exactly the same level as in
2011. According to the data available, GDP growth of 8.0% is expected for India in 2012, which
would be slightly less than in 2011.
The IMF sees risks for 2011 in the high levels of national debt, the volatility of the financial
markets, the financing of banks and uncompleted reforms of the financial markets, as well as
the weakness of real-estate markets in some countries. These countries additionally suffer from
persistently high unemployment rates owing to slow growth in industrialized countries.
We assume that uncertainties in the overall economic development of certain countries are
also to be expected in the future. Consequently, our forecasts have taken these uncertainties
into account.
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