March 5 (Bloomberg) -- The Organization for Economic Cooperation and Development cut its forecast for expansion this year in its 30 member nations to ``less than'' 2 percent, the weakest since 2003.

This ``will be a difficult year of lower growth and some more unpleasant surprises,'' OECD Secretary General Angel Gurria said in an interview in Oslo. ``We have revised downwards a number of our projections.''

Growth of less than 2 percent would mark a reversal of the OECD's previous forecast that the economy would weather the fallout from the U.S. slowdown and rebound in 2009. It would also highlight the mounting reliance of the world economy on emerging markets such as China and India, which aren't OECD members.

Growth is faltering in more developed economies as the U.S. housing recession, bank write-offs and higher credit costs curb consumer spending and corporate investment.

``Long gone are the days when the financial crisis was considered a U.S. problem,'' said Lena Komileva, chief economist at Tullet Prebon Plc in London. ``The U.S. will ultimately act as a drag on the rest of the world.''

In December, the Paris-based organization predicted a 2.3 percent growth rate in 2008 and 2.4 percent next year following last year's 2.7 percent. It's scheduled to release new forecasts on March 20.

Gurria's projection is weaker than that for overall global growth of 4.1 percent this year from the International Monetary Fund. That's because the IMF's estimate covers 185 economies, including faster-growing emerging nations.

Emerging Economies

Developing and emerging economies, including China and India, will expand 6.9 percent this year, the IMF predicted on Jan. 29. Such upswings are helping to protect the global economy from the 3 percent pace that economists deem a worldwide recession.

``Developing economies are still growing strongly,'' said Gurria.

Jean-Luc Schneider, deputy director of the OECD's economics department, said the agency is ``not yet completely convinced there will be a recession'' in the U.S., though it will be ``flirting'' with contraction. That will affect other OECD economies, especially those in Europe, said Gurria.

While European growth won't be as ``uncomfortable'' as in the U.S., it'll ``probably be worse than we know today,'' Gurria said. Japan is experiencing ``less of an impact,'' he said.

To contact the reporter on this story: Robin Wigglesworth in Oslo at wigglesworth@bloomberg.netSimon Kennedy in Paris at skennedy4@bloomberg.net

Last Updated: March 5, 2008 13:21 EST