#IMF Christine Lagarde: ‘We need to elevate growth to a higher plane’

| May 18, 2019

International Monetary Fund (IMF) President Christine Lagarde (pictured) has warned of a major slowdown for the world’s key economies in the coming months.

Speaking on Thursday (16 May), the French official said, “Two years ago, 75% of the global economy experienced an upswing. This year, we expect 70% to experience a slowdown in growth.

She warned of a “delicate moment” for the world’s economies, adding, “The loss of global growth momentum in the second half of 2018 reflected in large part trade tensions and tightening financial conditions. Yet, over the next six months, we expect the global economy to rebound. So, you can see what I mean by a delicate moment.

The next steps we take together will be critical in putting us on the right path.”

Lagarde, who is being tipped as a possible successor to Jean-Claude Juncker at the European commission after next week’s European elections (23-26 May), said, “Throughout the CCA growth has picked up since 2014 and is now expected to remain at 4.1 percent this year and in 2020. However, this number is still well below the long-term potential for the region — and it is too low if the region is to raise living standards to the level of other emerging economies in Europe and Asia.”

Lagarde was giving the opening speech at the Astana Economic Forum at Nur-Sultan, Kazakhstan.

She added: “So, the challenge is clear. We need to elevate growth to a higher plain. We need to stride carefully, yet confidently on this path. We need good domestic policies, increased economic diversification, and stronger international cooperation.

“Most importantly, we need inclusive and sustainable growth that lifts up the prospects of women, young people, the poor, and those who live in rural areas, and that raises the expectations of future generations.”

She pointed to new IMF research, released on Thursday, which Lagarde “focuses on achieving precisely this kind of inclusive growth in the region.”

There is no “one-size-fits-all” solution, but fiscal policy should balance debt concerns with “critical” initiatives in health, education, and infrastructure. Also, corruption needs to be addressed head-on in the region, she said.

She also said that women and other under-represented groups can be empowered by continuing to eliminate legal and economic barriers.

“I am pleased to say that through the hard work of the government and private companies female labour force participation in Kazakhstan is now at 65% — the highest in the region and a benchmark for every country in Central Asia.”

Lagarde, often voted one of the most powerful female politicians in the world, said the Caucasus and Central Asia (CCA) region “will play a key role” in “elevating” economic growth.

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