OECD says world facing worst recession since the 1980s

SHOTLIST 1. Wide of media briefing 2. SOUNDBITE:(English) Klaus Schmidt-Hebbel, Chief Economist, OECD (Organisation for Economic Co-operation and Development): "We project that 21 out of 30 member economies of the OECD will go through a protracted recession of a magnitude that his not been seen since the early 1980s." 3. Cutaway of briefing notes 4. Cutaway of journalist reading notes 5. SOUNDBITE: (English) Klaus Schmidt-Hebbel, Chief Economist, OECD (Organisation for Economic Co-operation and Development): "As a result of the recession the number of unemployed people will rise by something close to 8 (m) million people. This will happen, is happening now already and will happen until mid 2010." 6. Tilt up from notes to journalist's face 7. SOUNDBITE: (English) Klaus Schmidt-Hebbel, Chief Economist, OECD (Organisation for Economic Co-operation and Development): "US GDP is projected to continue falling until and through the first half of 2009 and this is due obviously to number 1 the housing downturn, number 2 the severe financial crisis - which is probably the most severe in the United States itself, and number 3 and very importantly the massive losses in household wealth which come from the declining stock market prices and house price slumps." 8. Cutaway of journalist wearing headphones 9. SOUNDBITE: (English) Klaus Schmidt-Hebbel, Chief Economist, OECD (Organisation for Economic Co-operation and Development): "The Euro area is also in recession now already. It will continue contracting in the next 6 months until mid 2009 as tighter financial conditions, very low income growth and negative wealth effects, again due to lower equity prices and house prices, will dampen consumption and will also reduce significantly investment. Econonic activity then gradually recovers as monetary easing gains traction and the effects of the global financial crisis dissipate and also as some of the fiscal packages take effect on activity and employment." 10. Pan of journalists STORYLINE The financial crisis will likely push the world's developed countries into their worst recession since the early 1980s according to the Organisation for Economic Cooperation and Development's (OECD). "21 out of 30 member economies of the OECD will go through a protracted recession of a magnitude that his not been seen since the early 1980s," Klaus Schmidt-Hebbel, the OECD's chief economist told a news conference. In its half-yearly economic outlook, the Paris-based organisation said economic output would likely shrink by 0.4 percent in 2009 for the 30 market democracies that make up its membership, against the 1.4 percent growth prediction for 2008. As a result, the OECD says it supports fiscal rescue measures, including tax cuts, provided they are targeted and temporary. The OECD says the number of unemployed across its member states could rise by 8 (m) million over the next two years and that there is a risk that some countries will experience deflation or falling prices. The organisation's latest 2009 projections for the world's leading three economic areas are more or less the same as the preliminary forecasts made earlier this month ahead of the G-20 meeting of world leaders in Washington, with only 2009 growth in the euro-zone revised down from the previous estimate of -0.5 percent. The OECD said economic growth of its membership fell by an annualised quarter-on-quarter 0.2 percent in the third quarter this year and will keep contracting until the middle of 2009. The biggest loss of output in the OECD is expected to occur during the fourth quarter of 2008, with a 1.4 percent contraction predicted. The figures indicate that the developed world has now entered a slump estimated to last at least four quarters; decline in the fourth. You can license this story through AP Archive: http://www.aparchive.com/metadata/youtube/aad5b031790c3d6e30c62f27429a27db Find out more about AP Archive: http://www.aparchive.com/HowWeWork