WORLD BANK chief Robert Zoellick has warned that the global economic crisis could lead to serious social upheavals.
The head of the World Bank has warned of the destabilising effects of mass unemployment.
‘If we do not take measures, there is a risk of a serious human and social crisis with very serious political implications,’ Zoellick said.
He pointed to Eastern Europe, which faces the ‘tricky situation’ of fast-shrinking economies, state bankruptcies, rapidly growing unemployment and explosive and uncontrollable protests.
Zoellick suggested that it was a matter of the greatest urgency that governments start preparing for high levels of unemployment.
‘In my opinion, in this context, nobody really knows what is going to happen and the best one can do is be ready for any eventuality,’ Zoellick said in an interview with Spain’s El Pais newspaper.
‘There is also what I call the “X-factor”, that one can not foresee, such as the recent outbreak of swine flu,’ he said.
His verdict on the current situation was that ‘Latin America has remained reasonably stable, even if Mexico and Central America are under pressure because they rely a lot on the North American market.’
It was reported last week that Mexico’s economy shrank by 8.2 per cent in the first three months of this year compared with a year earlier.
Mexico sends 80 per cent of its exports to the US, and its economy is sinking into slump alongside that of the United States.
Other economies in Eastern Europe have registered double-digit declines in GDP, such as Latvia and Estonia.
The retiring Bank of England rate-setter David Blanchflower has said at least one million more people in the UK will lose their jobs, visualising a figure close to four million unemployed.
The World Bank has previously warned of a ‘human catastrophe’ in the world’s poorest countries unless more is done to tackle the global economic crisis.
It said an extra 53 million people are at risk of extreme poverty.
Now it is warning of the explosive consequences of mass unemployment in the advanced capitalist countries – and with no solution to offer to resolve this developing crisis.
