World Bank President Robert Zoellick
Source: Press TV
World Bank (WB) President Robert Zoellick has warned of dire prospects for global markets as investors lose confidence in the economic leadership of Western countries.
Zoellick emphasized on Sunday that the latest financial downturns in the United States and Europe have shaken up investors in Western nations, which are already struggling to overcome debt issues and unemployment, AFP reported.
"And I think that those events combined with some of the other fragilities...have pushed us into a new danger zone. And I don't say those words lightly,” he noted.
Zoellick added that last month's political wrangling in the US Congress over the raising of the country's debt ceiling has contributed to the confidence deficit.
"When they saw the 'Sturm und Drang' in Congress and with the [chief] executive (the US President Barack Obama), it made them uncertain about; does the United States really know where it's going? And is it going to get there?" he asked.
Intense party politics and rivalry between Democratic and Republican lawmakers on Capitol Hill over critical federal budgetary and deficit issues brought Washington very close to its first-ever debt default earlier this month.
The WB chief said the financial doldrums in the US were even far graver than those of the Eurozone.
The EU has spent much of the past 18 months trying to battle its own debt crisis and has so far provided huge funds to Greece, Ireland, and Portugal with hefty bailout packages. European governments have started efforts to rush measures through their own parliaments to bring stability to European financial markets, which have taken major dives over the past week.
"We're kind of moving from drama to trauma for a lot of the Eurozone countries," Zoellick asserted.