The economic situation in Ireland is different from the Greek crisis because Ireland's problems are known ones and there are new tools available to address them, the OECD's chief economist said today.
"We know what the problems are. We know that in the case of Ireland, the problem was an unsustainable growth model," Pier Carlo Padoan, chief economist at the Organisation for Economic Co-operation and Development (OECD), said in an interview.
"So we know what the solutions are - there's nothing new. It is not nice but we know what it is," he said on the sidelines of a conference in Seoul.
Mr Padoan added that he believed global recovery would continue to move ahead, although at a slower pace "for a number of reasons", including resilient world trade and bright prospects for corporate investment.
"Therefore, the policy stance should remain the way it is, meaning modestly accommodative for monetary policy and moving towards fiscal consolidation," he said.
Central banks from Australia to South Korea recently paused in their campaigns to return to tighter interest rate policies following the global financial crisis, citing greater risk of a cooling global recovery.
"We have only one scenario, which is a slow recovery with risks to the scenario," he said. "We don't see a double dip."
He said resilient exports led by some emerging economies in Asia and Latin America despite slowing recovery in advanced economies did not represent a so-called decoupling, but were a result of their reform efforts over the past several years.
Reuters