The Organization for Economic Co-operation and Development says that the leaders of the G20 need to commit to bold action to revive global economic growth.

Ahead of the next G20 summit later this week, the OECD’s secretary-general, Angel Gurría, said that without decisive action the outlook is gloomy. The OECD projects GDP growth to remain weak in the advanced G20 economies over the next two years while the pace of activity in the major emerging markets is likely to be lower than in the pre-crisis period.

It says that uncertainties regarding the short-term economic outlook have risen dramatically in recent months, and projects that real GDP will grow by about 3.9% this year, 3.8% in 2012 and 4.6% in 2013 on average in G20 countries, noting that this average masks a wide divergence among countries. In the euro area, it sees a marked slowdown with patches of mild negative growth as likely, and says that growth is also projected to remain weak in the United States, with a gradual pick-up from 2012.

To improve the outlook, the OECD says that European Union leaders need to promptly fulfill the commitments they made last week to stabilize the banking system and bolster the region’s bailout fund, which could help restore confidence and create positive feedback effects that could trigger a scenario of stronger growth.

Moreover, it says that in the advanced G20 economies, interest rates should remain on hold or, where possible, be reduced; notably in the euro area. It says that credible medium-term frameworks for fiscal consolidation are needed to restore confidence in the longer-term sustainability of public finances. And, structural reforms are essential to boost the growth potential of G20 countries, to tackle high unemployment and to rebalance global demand, it adds.

“In 2008, G20 leaders rose to the challenge with a clear and coherent plan and we avoided a second Great Depression. Today, the adoption and implementation of the action plan is just as imperative to restore confidence through decisive actions in specific countries and regions,” it says.