IMF MD Key Messages “Towards a More Secure Recovery Shared by All”

Christine Lagarde, Managing Director, International Monetary Fund (IMF)

October 13, 2017/IMF

Christine Lagarde calls on the IMF’s 189 members to seize this opportunity to get to the heart of a stronger recovery—a recovery shared by all. Ms. Lagarde highlights three policy priorities:
1. Get the economic fundamentals right. Ms. Lagarde said: “In our increasingly interconnected world, countries travel together, but on different paths and at different speeds. Policies need to keep pace.”
➢ Ms. Lagarde said: “Our analysis of structural reforms over economic cycles shows that labor and product market reforms are more potent during economic upswings.”
2. Tackle excessive inequality head-on—because it hinders growth and erodes trust. How? By investing in health and education, strengthening safety nets, empowering women, and adapting tax systems.
➢ Empowering women at all levels of society would be a “global game changer.” “It would increase growth, reduce inequality, and support diversity.”
3. Address the major concerns of young people, notably corruption and climate change. Ms. Lagarde said: “Systemic corruption undermines people’s trust in government and reduces growth potential.”
➢ IMF analysis shows: “Moving from high to low perceived corruption levels can increase public investment efficiency by 50 percent—and raise real per capita income by nearly one percentage point.
➢ Fighting money laundering and terrorist financing is a key priority for the IMF. “We have provided technical assistance in this area to 120 countries.”
➢ “Energy pricing is key, because trillions of dollars are being spent on subsidies that drive carbon emissions,” Ms. Lagarde said. “With energy prices relatively low, we now have the opportunity to reduce and eliminate these subsidies.”
International cooperation. Ms. Lagarde said: “We know from experience that international cooperation works—from reconstruction after World War II more than 70 years ago to fighting Ebola just a few years back.”
➢ Over the past year: 17 lending programs for a total of US$27 billion; 127 country consultations, with issues ranging from gender analysis in Rwanda, to climate change resilience in Seychelles, to inclusion and tax reform in the United States.
➢ Ms. Lagarde said: “Going forward, we will offer technical assistance to increase fiscal capacity, analyze the macroeconomic implications of technology, and look at how we can better help low-income countries deal with the burden of conflicts and natural disasters.”