APEC sticks with stimulus to cement fragile recovery

By Nopporn Wong-Anan

SINGAPORE (Reuters) - Pacific rim ministers agreed on Thursday to stick with stimulus plans as long as it takes to achieve a sustained economic recovery, warning that unemployment is still too high and systemic barriers to new growth remain.

"The global economic situation has eased considerably," trade and foreign ministers of the 21-member Asia Pacific Economic Cooperation (APEC) said in a statement after talks in Singapore.

"But the recovery remains fragile; the growth profile over the next few quarters is likely to be uneven. Unemployment remains unacceptably high in many of our economies."

U.S. Treasury Secretary Timothy Geithner said the emergency measures put in place by APEC member governments -- including some $1 trillion in Asia and $787 billion in the United States alone -- had prevented a deeper downturn.

He said the pace at which "exit strategies" from those fiscal and monetary stimulus steps are implemented will vary. This is because the group includes China and other Asian economies that avoided a recession, but also the United States and Japan which were plunged into recession after last year's credit crisis.

Geithner made it clear that for the United States a return to healthy economic growth remained the imperative.

"The challenge is growth. First growth, but make sure we have business confidence restored, investments expanding again, unemployment coming down, financial sector definitively repaired -- that's our basic challenge," he said.

For its part, Japan said it was not yet ready to unwind policies put in place to revive the economy because domestic demand is still very frail and the corporate outlook is bleak.