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Former U.S. policymaker says Europe is biggest threat to global economy this year Updated: 2016-03-02 21:53:06 KST

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2016-03-02

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The crisis in the eurozone stands as the biggest downside risk facing the global economy this year. That's according to Anne Krueger‚ the former first deputy managing director of the IMF‚ who says there are many challenges that could shape the fate of the European Union in the months to come. "While the situation in Greece is not immediately critical‚ there are still chronic issues in that country that could turn into crisis. Ukraine has difficulties‚ both economic and geopolitical. In the rest of eurozone there are difficulties that must be resolved. The British have decided to hold an election as to whether to stay in the EU in June and there's uncertainties as to what the outcome will be. The refugee crisis is very big and constitutes a challenge to the Europeans and their unity." Kruger -- currently a professor at Johns Hopkins University -- said the outlook for the rest of the world doesn't look so rosy either‚ with faltering global commodity prices and a slowdown in China tugging on the global economy. She said we are living in a two-track world‚ in which recovery and recession coexist. "On one hand‚ the outlook for the U.S. economy and a few others is good. On the other hand‚ there's a number of countries whose prospects are much poorer‚ while there are a few countries in the middle‚ their near-term future will be determined in significant part by the balance between the expansion of the countries doing well and those in recession‚ slowdown or stagnation doing badly." On a more positive note‚ the former policymaker said that the American economy continues to improve and if it sustains its momentum‚ it may have an impact on the global economy down the line. But she also noted that the U.S. is not as dominant as before‚ and that it‚ too‚ is affected by global uncertainties. Kim Min-ji‚ Arirang News. Reporter : kimmj@arirang.com

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