The current global financial crisis could cause "considerable trauma" for the whole of 2008 because its causes are not yet fully understood, BP chairman Peter Sutherland has warned.
Speaking on TV3's The Political Partylast night, the successful Irish businessman said it would certainly continue through the first half of the year.
"The problem is everyone says that we can rely on growth in China and India, but China exports most of its products to the United States so if the US is in a recession, this is a problem."
The full background to the crisis is not yet fully understood and has not fully played out in regard to providing credit and liquidity to institutions, "so I think it is a dangerous period for the world", Mr Sutherland said.
The US economy is "in a mess", with the result that the dollar is weakening and the euro is strengthening.
The situation makes it more difficult for Ireland to sell in dollar-dominated markets, while productivity becomes a major issue for multinational operations based here, Mr Sutherland said.
The International Monetary Fund meeting in Washington last month and other gatherings since of central bank governors were terribly depressing, he said, "because people didn't understand the extent of the problem".
"So I think it is a dangerous period for the world," said Mr Sutherland, who is also chairman of Goldman Sachs International.
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