Krugman says world economy is stabilising

Krugman, the Nobel laureate for economics, Paul Krugman, said in Monday that the world economy was successful in averting a catastrophe, and that the industrialized countries could grow this year, the news of the May 25 night. "I would not be surprised if world trade and global industrial output have stabilised and resumed growth in two months," Krugman said at a seminar. He said: "In the second half of this year, the U.S. and even Europe GDP growth rate is likely to be zero or more than 0."　　Krugman said he was concerned about a decade of landslides in the United States similar to Japan's in the 1990s.　　Mr Krugman has been critical of the government's rescue plan to persuade investors to help clean up $1 trillion trillion of toxic assets in banks.　　Speaking of the world's third-largest oil exporter, the UAE, Krugman says Japanese-style export-led growth is not a viable solution because the landslide is global. "In some ways we may be out of the doldrums, but stabilising and really building a solid foundation are two different things," he said. "We can't all rely on exports to restore growth, no other planet to trade with us." So Japan's past path does not apply to all countries. He said the recovery would be possible if large companies began to invest more, or if there were major technological innovations that could be equated with the IT revolution of the 1990s, or if there were important government initiatives on climate change.