World Bank chief Zoellick warns "world in danger zone"

Robert Zoellick, the World Bank president, warned "the world is in a danger zone" as the economic crisis in the United States, Europe and Japan threatened to ravage the rest of the global economy.

He said developed advanced needed to act quickly to resolve their crises to halt any contagion spreadiing.

"While developed countries stumble the situation for emerging markets may be changing for the worse," he said at the opening of the World Bank-International Monetary Fund annual meetings.

"Since August we've seen bond spreads for emerging markets increase, their equity markets have declined like developed markets and capital flows have declined sharply,"

Mr Zoellick said: "Europe, Japan, and the United States must act to address their big economic problems before they become bigger problems for the rest of the world."

Not to do so would be "irresponsible", he said, adding: "In 2008 many people said they did not see the turbulence coming. Leaders have no such excuse now."

Talking about how much the global economy will contract, he said: "I still think a double dip recession for the world's major economies is unlikely, but my confidence in that is being eroded daily by the steady drip of difficult economic news."

Mr Zoellick urged the world must remain alert to the dangers of 'destructive' protectionist policies in demand falls.

'Don't let the world slip into protectionism,' he said, warning that developing countries had limited fiscal space to respond to a global downturn compared to the 2007-2008 financial crisis and faced the risk of a return to populism. Agencies