IMF warns developing nations

In a speech in New Delhi, IMF managing director Dominique Strauss-Kahn said the links between the West and countries such as India remain strong. As a result the US slowdown will effect developing nations, he argued. To cope with that, he advised emerging nations to manage their finances and regulatory systems carefully.

According to the IMF, in the past a 1 percent decline in US growth had led to a decline in growth in emerging economies by between 0.5 percent and 1 percent, depending on trade and financial links to the US.