The head of the International Monetary Fund (IMF) has praised Europe's strong economic growth but warned of the dangers of protectionism.

Rodrigo de Rato said Europe's economic upturn in recent months, led by Germany and France, was a major boost for the global economy.

But he said efforts must be made to conclude a global trade treaty and to reduce levels of unemployment.

He called for renewed reform efforts to deregulate eurozone labor markets.

Although the eurozone was expected to see growth above 2% in 2007 and 2008, de Rato said the specter of protectionism and higher levels of unemployment compared with the U.S. threatened the turnaround. "We are seeing a long-awaited pickup in investment and employment in Europe," he said in a speech in the U.S.

"Of course, there are risks to this benign outlook," he added.

"One that is particularly troubling is a possible resurgence of protectionism. "Government and citizens all around the world, including Europe, should be very concerned about the negotiations in the Doha round."

Trade ministers from the EU, U.S. and developing countries are meeting in Davos later this month to try and kick-start global trade talks which have been stalled for six months. (Source: BBC)