Nations need customised action for full-speed recovery: Lagarde
Washington: The International Monetary Fund (IMF) Director Christine Lagarde has called for “customised action” by countries to put the global economy on the path of “full-speed recovery” that is solid, sustainable and balanced. In her interaction with the media on the sidelines of the annual Spring meeting of the IMF and World Bank yesterday, she expressed her dissatisfaction over what she termed as emergence of a “three-speed” global economy. These are countries that are doing well, those countries that are on the mend, and those countries that still have quite a distance to travel, she said.
“Now, with strong interconnections, and uneven recovery, that three-speed recovery is not the healthiest recovery we could think of. The three-speed recovery is not enough and what we need is a full-speed global economy — growth that is solid, sustainable, balanced, but also inclusive and very much rooted in green developments,” she said.
“This requires for the global economy to move from that three-speed recovery that we are observing to a full-speed recovery, with the kind of growth that we want, that requires clearly customised policy responses in each of the three groups that I have just identified. “Those that are doing well, those on the mend, and those that still have a way to go,” Lagarde said.
According to the IMF Director, the emerging markets face the new risk of avoiding financial excesses. “They should rebuild policy space and strengthen financial regulation and supervision. Low-income countries, and in that group you really observe probably the fastest growth rates at the moment, they should build on success and invest in the future, including by meeting infrastructure and social needs,” she said. “And that is where the inclusive growth really kicks in.