Paris - The world economic crisis will last well into 2010 unless the global banking sector is restructured and cleansed of its toxic assets, the head of the International Monetary Fund (IMF), Dominique Strauss-Kahn, warned Thursday in Paris.

"If there is no clean-up of the banks, most of the stimulus will be lost," Dominique Strauss-Kahn said, adding: "Things are moving too slowly."

"We are still looking for a recovery at the beginning of 2010, but only if the right policies are implemented," Strauss-Kahn said at a press conference opening the OECD Global Forum on Competition in Paris.

Fiscal stimulus packages are part of those policies, he said. "But the effectiveness of the fiscal stimulus depends on the restructuring and clean-up of the banking sector," the IMF secretary-general said.

Strauss-Kahn said that, in addition to the banking sector, another big concern regarding the global economy was that the crisis had now begun to spread to emerging countries, because their capital inflows were "drying up."

He also warned that 2009 would be a "really bad year," perhaps even worse than most current forecasts.

Strauss-Kahn made the comments one day after the OECD said, in a preliminary estimate, that the economies of its 30 member countries had contracted by 1.5 per cent in the fourth quarter of 2008, the largest fall since OECD records began in 1960. (dpa)