Global economic confidence has halved in the two years since April 2007, with fear of a worsening economic situation driving the downturn, according to a survey of about 1,000 people in each of 22 countries by polling firm Ipsos Mori. Meanwhile on Monday,  the head of the Paris-based Organisation for Economic Co-operation and Development (OECD), said one in 10 workers in advanced economies will be without a job in 2010,“practically with no exceptions.”

Ipsos Mori says pessimists outweigh optimists by two to one, with the sharpest falls in confidence in big western economies but with an equally dramatic fall in China and a fall also in India, which nonetheless remains the most positive country.

Almost three out of four people said they had already cut back on spending. “The irony here is that the very act of cutting back is helping create what the public fears most: a full-blown, deep and long-lasting economic decline,” Gideon Skinner, a director of Ipsos Mori, said.

Skinner said with the Group of 20 (G-20) meeting in London this week, it was important for governments “to communicate a sense of hope.” With business and political leaders both panicked it was unsurprising that citizens felt panicked, he added.

Unemployment is the biggest concern, while across Latin America crime and violence are the most serious concerns, with corruption high among people’s worries in many emerging markets.

Support for globalisation remains reasonably strong, but as the survey was web-based, it may reflect the views of more affluent people.

Two-thirds of those surveyed say globalisation has been good for their country, although with big differences. Those in India, China and South Korea are most likely to agree – well over 80 per cent. Fewer than 60 per cent believe that proposition in the UK, the Czech Republic and Belgium, while just 45 per cent do in France.

“Whether this perception will survive as the world economy slips deeper into recession remains to be seen,”Skinner said.

But trust in business remains low. “There is a widely held perception that companies cannot generally be trusted,” he added.

One in 10 workers in OECD without a job in 2010

One in 10 workers in advanced economies will be without a job next year, “practically with no exceptions”, the head of the Organisation for Economic Co-operation and Development said on Monday.

OECD Director General Angel Gurría warned that the ranks of the unemployed in the 30 mainly advanced OECD countries would swell“by about 25m people, by far the largest and most rapid increase in OECD unemployment in the postwar period.”

The 30 member countries of OECD are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom, United States.

Gurría, who is a former Finance and Foreign Minister of Mexico, said the misery of joblessness – which he termed as “rapidly turning into a jobs and social crisis” – would come as the OECD forecast the 30-country group economies will contract by 4.3 per cent in 2009 with little or no growth expected in 2010. The forecast compares with the IMF’s  recent estimate of a 3-3.5 per cent contraction for 2009.

The OECD also said on Monday, that countries participating in a “Freedom of Investment” initiative, which together represent four fifths of the world economy, have pledged to resist discriminatory policies and new forms of protectionism towards investment in the context of the global economic crisis and to continue to monitor measures and commitments.

“Investment protectionism remains a threat, but so far governments have for the most part resisted temptations to impose barriers,”Angel Gurría said. “But the need for vigilance remains constant. This agreement is an important sign of governments’ commitment to resisting protectionism.”

For the moment, most governments continue to welcome inward investment with open arms, especially in this period of crisis. In a report approved at a meeting at OECD headquarters, the countries participating in the “Freedom of Investment, National Security and “Strategic Industries” (FOI)” process reaffirmed their commitments to openness and non-discrimination in host country investment policies and to transparent, accountable and effective public policy.

The report, entitled “Building Trust and Confidence in International Investment” sets out a series of policy recommendations for maintaining open investment markets, including the use of peer reviews and regular monitoring of national policy measures. Its basis is the FOI initiative, launched in 2006 to help governments preserve and expand an open environment for international investment while safeguarding essential security interests and acting to support economic development. All 30 OECD countries participate and, so far, 17 non-OECD countries including Brazil, China, India, Russia, South Africa.

Amid the current recession, the report notes, one of the most serious risks to cross-border investment lies in the emergence of new forms of discrimination that impede both outward and inward investment flows, participants in the meeting acknowledged. Thanks to moves to support companies and financial institutions in the crisis, many governments have acquired broad powers to channel public sector investment and subsidies, often with wide discretion in how they use these new powers.

Political pressures to protect employment and restore growth risk tempting governments into adopting discriminatory policies that will ultimately hinder a return to growth. To guard against this, participants in the meeting agreed on a process of peer monitoring designed to make policy measures more transparent and show up possible misuse of new discretionary powers in ways that are unfair to international investors.

“On one hand,” the report states, “recipient countries genuinely want – indeed, compete for – foreign investment projects. They are reluctant to take protectionist measures that would undermine business confidence and several have recently taken steps to liberalise investment policies.” For example, participants welcomed measures taken by Canada and India to make their investment review procedures less restrictive for international investors.

“On the other, all recipient countries have constituencies that may advocate protectionist policies and these may be strengthened by the global crisis. Thus, policy makers are simultaneously pushed in two directions, toward both openness and protectionism.”

The FOI process “is designed to make it easier for countries to choose openness and be more aware of the costs of ceding to protectionist pressures,” Gurría commented. “Peer review and monitoring will allow them to learn from each others’ successes and mistakes at a time when many governments are actively seeking models for good policy practice.”