The OECD Economics Department's projections for output, employment, prices and current balances over the next two years, based on a review of each Member country and of the induced effect on each of them of international developments. Particular attention is paid to the policies that governments are adopting to solve present economic problems. Summary statistics and projections are included for developments in non-member countries, in particular in Central and Eastern Europe as well as in selected Asian and Latin American economies. Three special topics are covered in this issue: fiscal consolidation and the effectiveness of the public sector, implications of European Monetary Union, and financial sector liberalisation in emerging markets. Progress in the fight against unemployment is also examined.