Recovery expected to keep on in a two-speed mode

Nariman Behravesh, chief economist at IHS Global Insight, said the deceleration in growth that manifested itself in the latter half of 2010 would extend into the first half of 2011 – for nearly every region and country in the world.

However, the global recovery should pick up steam in the second half of the year, as some of the worst-hit sectors – housing and vehicles – rebound and as consumer and business confidence improves, he said.

Arithmetically, this means that growth in calendar-year 2011 – 3.3 per cent – will be a little weaker than in 2010 – four per cent – but then be followed by a bounce-back in 2012 of 3.7 per cent.

While there is no shortage of downside risks, global growth has been revised up in recent months, which means that the distribution of risks may be more symmetric than a year ago, added Mr Behravesh, who said Europe's GDP would grow by 1.6 per cent 2011.