By Robert Carry

The Organisation for Economic Co-operation and Development (ODEC) is predicting that Australia's economic recovery will be more robust than those seen elsewhere in the west.

In the group's semi-annual economic outlook, the ODEC encouraged a gradual rise in interest rates and the withdrawal of fiscal stimulus by 2011.

"Australia is likely to experience a relatively more robust recovery," said the group, adding that the nation's economy should grow by 2.5% next year and by 3.5% in 2011.

According to reports from news agency Reuters, federal treasurer Wayne Swan said the OECD report provided further evidence that Australia is surging ahead of other developed economies.

"Stimulus, both fiscal and monetary, has meant Australia has avoided the permanent skills and capital destruction that generally accompanies deep downturns and has meant less permanent damage to our economy," he said.

The reported added that the planned reduction of the federal budgetary stimulus "seems to be an appropriate response to the needs of the economy".

"Current economic trends and the reduction in negative macroeconomic risks argue in favour of a gradual tightening of monetary policy," the report continued.

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