IMF Managing Director Kristalina Georgieva said that prudent macroeconomic policies and strong institutions are essential for growth, jobs and improving living standards
Washington:
Faced with the dual mission of combating the coronavirus pandemic today and building a better tomorrow, the world is witnessing a new moment in Bretton Woods, said Kristalina Georgieva, Managing Director of the International Monetary Fund, Thursday.
A pandemic has already cost more than a million people. An economic disaster that will make the global economy 4.4 percent smaller this year and deprive an estimated $ 11 trillion of output by next year. And untold human despair in the face of turmoil." The massive and increasing poverty for the first time in decades, "she said in a speech at the annual meeting of the International Monetary Fund's Board of Governors.
She said that what was true at Bretton Woods, when the Allies gathered at the end of World War II at a conference to create institutions that would use economic cooperation to prevent future conflicts, remains true today.
She said prudent macroeconomic policies and strong institutions are essential for growth, jobs and improving living standards.
It has brought about strong medium-term frameworks for monetary, fiscal, and monetary policies, as well as reforms to enhance trade, competitiveness and productivity, which may wish to help create self-confidence to take political action now while building much-needed resilience in the future.
"We are aware of the measures we want to take now. A lasting economic recovery can only be achieved if we overcome the epidemic. Health measures must remain a priority. I urge you to support the production and distribution of effective treatments and vaccines to ensure that all countries have them," said Georgieva.
It also urged countries to continue supporting workers and companies until the permanent exit from the health crisis.
Major central banks expanded their balance sheets by $ 7.5 trillion. These simultaneous actions prevented the overall destructive financial reactions that we saw in previous crises," she said.
“But almost all countries are still affected, especially emerging market and developing economies. And while the global banking system has entered the crisis with high reserves of capital and liquidity, there is a weak tail of banks in many emerging markets. We must take measures for it. Avoid accumulating financial risks in the medium term. "
The International Monetary Fund expects 2021 debt levels to rise dramatically - to around 125 percent of GDP in advanced economies, and 65 percent of GDP in emerging markets; Georgieva added that 50 percent of GDP is in low-income countries.
The IMF provides debt relief to its poorest members, and in cooperation with the World Bank, the Fund is supporting the G20 extension of the debt service suspension initiative.
Moreover, where the debt cannot be sustained, it must be restructured without delay. We should move towards more transparency on debt and better coordination of creditors. I have been encouraged by the G20 discussions on a common framework for sovereign debt settlement as well as based on our call for an improved sovereign debt settlement structure. , Including private sector participation. "
Georgieva said that to reap the full benefits of a sound economic policy, they must invest more in people. This means protecting the weak. It also means enhancing human and physical capital to support growth and resilience, she said.
`` Just as the epidemic has proven that we can no longer exceed our fitness precautions, we can no longer skip an alternative to the local weather ... it is holistic, and it poses profound threats to growth and prosperity. It is also the people that are“ critical and the planet Earth is critical, ”MD Fund said. International criticism.
She said the International Monetary Fund is working tirelessly to support a lasting recovery and resilient future as countries adapt to structural shifts caused by climate change, digital acceleration and the rise of the knowledge economy.
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