WASHINGTON -- Finance leaders who have grown accustomed to relying on the United States to be a primary engine of growth for the global economy are searching for a replacement engine now that the U.S. economy is slowing.
The new Bush administration is pushing the idea that what is needed now is more balanced growth among the three biggest economic areas -- the United States, Japan and Europe.
The issue of growth will be topic No. 1 when finance officials gather for three days of discussions during the spring meetings of the 183-nation International Monetary Fund and its sister lending organization, the World Bank.
The talks will be kicked off Saturday when Treasury Secretary Paul O'Neill and Federal Reserve Chairman Alan Greenspan serve as hosts for their counterparts from the world's seven richest industrial countries.
A senior Treasury official said those discussions will focus on looking for ways to provide growth among all the major economies.
"The most important thing for each country is to get its own policies right," said the U.S. official, who briefed reporters on Thursday on condition of anonymity. "If each country pays attention to that, that is 90 percent of the battle."
O'Neill, IMF Managing Director Horst Koehler and World Bank President James Wolfensohn were scheduled to brief reporters Friday on their outlook for the weekend meetings.
One thing the finance leaders apparently won't have to worry about is a repeat of last spring's gathering, when thousands of protesters clogged downtown Washington streets in an effort to keep delegates from attending the sessions.
This time around, protest leaders said they plan to stress issues in smaller gatherings rather than mount large-scale marches to disrupt the meetings.
The IMF on Thursday released its latest economic forecast, projecting that the global economy will grow by just 3.2 percent this year, its weakest performance since the 1997-98 Asian currency crisis and a full percentage point lower than the IMF's estimate last fall for global growth.
"The outlook remains subject to considerable uncertainty, and a deeper and more prolonged downturn is clearly possible," the IMF said.
The IMF predicted the U.S. economy will expand by just 1.5 percent this year, its poorest showing since the last U.S. recession ended in 1991 and less than half the 3.2 percent U.S. growth the IMF had forecast last fall.
The fund also significantly lowered its forecasts for other countries, cutting its growth estimate for Japan to a barely discernible 0.6 percent and reducing the estimate for the 12-nation European common currency area to 2.4 percent.
IMF officials said that the aggressive interest rate cuts by the Federal Reserve should lay the foundation for a rebound in U.S. growth late this year.
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