Finance Minister Hans-Rudolf Merz has expressed confidence that the world economy is on its way to recovery.

In an address to the annual meeting of the International Monetary Fund in Istanbul on Sunday reported on the government news site, he said manufacturing was rebounding and consumer confidence was stabilising.

But he warned that growth rates were likely to remain lower than their pre-crisis levels for some time to come.

"We will need to proceed cautiously so as not to stall the fragile recovery," he warned.

He said Switzerland had been a leader in developing improvements in the regulatory framework which are now being implemented internationally.

"It opted for the early implementation of measures in support of systemic stability, despite concerns over possible competitive disadvantages," he said.

But he said that public involvement in the financial sector should be terminated "as soon as market conditions permit".

While calling for some reforms of the IMF, he said that these should be pragmatic, rather than fundamental modifications of the institutional framework.

Merz was speaking on behalf of the so-called "Helvetistan" voting group in the IMF, made up of Azerbaijan, the Kyrgyz Republic, Poland, Serbia, Switzerland, Tajikistan, Turkmenistan, and Uzbekistan.

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