The world economy emerged from the crisis and continues to recover, but this process is too slow, requiring intensified effort, I’m sure the head of the International monetary Fund (IMF) Christine Lagarde.
“Of course, we have made significant process since the great financial crisis. But as the growth of the economy for too long remained too slow, too many people just don’t feel it,” said Lagarde, speaking in Frankfurt’s Goethe University.
The head of the IMF noted that the current growth rate of the global economy in the last six months has been provided mainly by emerging markets and advanced economies, contrary to expectations, was not able to participate fully in this process. The growth of the U.S. economy, according to Lagarde, prevents a strong dollar, the EU economy is the low level of investment and high unemployment, and the Middle East still has not recovered from the shock caused by falling oil prices.
Of particular concern, according to Lagarde, is the fact that purely economic risks are amplified due to the “political” — of terrorism, armed conflict and epidemics, causing people to flee to other countries in search of safety and a better life.
“All of these shocks cause people to doubt the efficacy of existing rules and international norms. Some see the solution to problems in the closure of borders and the transition to protectionism. But history teaches us — again and again — that would be a tragedy. The problems of our interconnected world will not solve the fragmentation and cooperation”, — said Lagarde.
In his speech, the head of the IMF urged the authorities and Central banks of different countries to intensify efforts to implement structural reforms in the economy, revision of tax policy and improving the effectiveness of monetary policy.
“We are not alarmed, but we are wary. We are faced with the problem of losing momentum. But if the regulators will be able to face the challenges and to work together, the positive effect of these actions on the global economy will be significant”, — said Lagarde.
His speech in Frankfurt’s Goethe University, the head of the IMF ended with a quote from Goethe: “a Few know — it is necessary to apply knowledge. Little desire to do”. According to Lagarde, the world economy is experiencing a period of uncertainty and now the heads of States and Central banks must show leadership qualities.