The prospects of global economy recovery improved as the world economy was expected to be back on a longer-term growth track next year, managing director of the International Monetary Fund (IMF), Horst Kohler, said Tuesday.

Kohler told Xinhua at the end of his China visit that signs of a global recovery were strengthening and the balance of risk was becoming more favorable.

He predicted global economic growth would pick up to four percent in 2004, while the growth of the Asian region would bounce back to six percent.

Kohler noted that the US economy showed increasing signs of recovery, while expectations for a pick-up in the European economy also improved as a tentative recovery seems to be taking hold in Japan, he said.

Asia would remain a bright spot in the global economic picture.

However, Kohler said, the recovery of global economy was "fragile" and facing uncertainties, including imbalance of trade, regional conflicts, natural disasters and fluctuations in oil prices.

Kohler cited the number one problem as the imbalance in global recovery and trade. The economic recovery of the United States was faster than in other areas, except emerging Asia, he said. As a result, the United States was playing an even greater role as the engine of world economy. But at the same time, he acknowledged, the current account deficit and fiscal deficit of the United States were also widening.

Kohler said the global current account imbalance might unwind in a disorderly form and there were risks of rapid depreciation of the US dollar. So he called for all countries to share a sense of joint responsibility to avoid "disruptive exchange rate changes".

Despite the uncertainties, Kohler expressed his "reasonable optimism" about the recovery of the global economy that had gone through three years of sluggish growth.

(Xinhua News Agency September 3, 2003)