Lagarde urges action over global growth challenges
The persistent global growth challenges has elicited a renewed call for global action by the International Monetary Fund (IMF), with world leaders already expressing their determination to address to tackle them with a set of forceful policy actions.
The Managing Director of IMF, Ms. Christine Lagarde, in her submission at the end of the just concluded Group of 20 (G20) Summit in Hangzhou, China, said the meeting came on the heels a global landscape that has been characterized by major economic and technological shifts.
According to her, the observed shifts are riding on the back of global growth that has been too low for too long and benefitted too few.
“A first priority is a coordinated effort to raise growth. The G20 agreed that this will require making full use of all policy levers- monetary, fiscal, and structural, individually and collectively.
“The G20 also agreed to identify and prioritize reforms that provide the biggest growth impulse for each country, which is an area where the IMF is actively engaged. Pushing back against protectionism and pushing forward with free and fair trade is a vital component of this growth agenda.
“A second priority is a commitment that growth must be more widely shared. Again, countries should deploy proven tools to reduce excessive inequality and raise economic prospects, particularly for low-income groups and workers affected by rapid technological change.
“For example, through skills training and investments in education and health. We need increased growth, but it must be better balanced, more sustainable, and inclusive so as to benefit all people,” she said.
She disclosed that G20 has endorsed several initiatives underway to support the stability and resilience of the international financial architecture.
This includes the support for further strengthening of the global financial safety net, with an adequately financed IMF at its center and equipped with a more effective toolkit.
“It would also involve even greater cooperation between the IMF and regional financing arrangements, such as the Chiang Mai Initiative.
“Regarding IMF resources, I am heartened that the G20 leaders supported maintaining access to bilateral and multilateral borrowing arrangements, in line with the objective of preserving the IMF’s current lending capacity.
“I especially appreciated the G20’s call for broad participation of the IMF membership in this effort, including through new agreements.
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