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UPDATE 2-OECD sees euro zone '09 GDP -4.1% -Slovene minister

Published 03/19/2009, 01:54 PM

(Updates with OECD comment on the figures, IMF comparison)

By Marja Novak

LJUBLJANA, March 19 (Reuters) - The euro zone economy will contract by 4.1 percent this year according to the latest OECD forecast, a government minister of euro zone member Slovenia said on Thursday.

The figure is even lower than the 3.5 percent GDP shrinkage the International Monetary Fund predicted for the euro zone this year in a new forecast published on Thursday, which was itself 1.2 percentage points weaker than the IMF was counting on as recently as January.

An OECD spokesman said that figure and other GDP figures the Slovene minister spoke of were "preparatory, provisional figures to be discussed next week", ahead of official publication of new OECD figures on March 31.

"The latest data of the Organisation for Economic Co-operation and Development (OECD) show the expected fall of economic growth in euro zone in 2009 is 4.1 percent," Minister of European Affairs and Development Mitja Gaspari told a news conference.

The figures from the Paris-based OECD showed Germany's economy will contract by 5.1 percent, Italy's by 4.2 percent and France's by 3.3 percent, he said.

The previous official OECD forecast, issued on November 25, predicted euro zone 2009 GDP down 0.6 percent, Germany down 0.8 percent, Italy down 1 percent and France down 0.4 percent.

Gaspari also said the euro zone's budget deficit is expected to reach 5.3 percent of GDP in 2009 according to the OECD, while Germany's deficit is seen at 4.5 percent, France's at 6.3 percent and Italy's at 4.9 percent.

He said the OECD's forecast for 2010 saw the euro zone economy contracting by 0.3 percent, while Germany's economy should expand by 0.2 percent that year.

(Additional reporting by Brian Love in Paris)

(Reporting by Marja Novak, Editing Victoria Main)

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