International Monetary Fund Managing Director Christine Lagarde said that nations across the globe must adopt a “good policy mix”, containing a set of policies, to boost economic growth and jobs.
She said a mix of policies can help to move the world beyond the “three-speed” recovery, where some countries are doing well, others are on the mend, and others are lagging behind. This is a condition that has emerged since the IMFC last met in October 2012 in Tokyo.
“Anything that works to create jobs” is on the table, she said at a news conference following the meeting of the International Monetary and Financial Committee (IMFC) in Washington.
The meeting was held on the sidelines of IMF-World Bank Spring Meetings as well as a gathering of G20 finance ministers and central bank governors over the weekend in Washington DC.
She said that economies now need “a good policy mix which relies on not just one policy but a set of policies that will include fiscal consolidation at the right pace, structural reforms” and “monetary policy, which provides the breathing space.”
“Growth and jobs were a very strong focus of our discussions,” Singapore Finance Minister Tharman Shanmugaratnam said Saturday after chairing the IMFC meeting.
“There was also a strong and common recognition that achieving growth and jobs cannot rest on one policy alone. There is no single bullet that will get us to normal growth and some normality with regard to jobs,” Tharman said.
IMFC, the Fund’s policy-steering committee, said in a communique that the world economy must attain full-speed, sustainable and balanced recovery.
IMFC called on advanced economies to keep their accommodative monetary policy intact in order to help bolster growth. However, the committee said that the easy policy should be accompanied by credible medium-term fiscal consolidation plans and stronger progress on financial sector and structural reforms.
At the same time, emerging market and developing countries need to recalibrate policies to rebuild buffers and guard against financial vulnerabilities as activity picks up, it added.
by RTT Staff Writer
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