IMF Managing Director Kristalina Georgieva, during her address at the G20 Leaders’ Summit, highlighted the slow and uneven nature of the global economic recovery. She underscored the importance of adopting sound policies to ensure financial stability and emphasized the need for growth-oriented structural reforms.
Key points from her address include:
- Global Recovery Challenges: Georgieva pointed out that the global recovery from the COVID-19 pandemic has been sluggish and uneven. This situation calls for concerted efforts to support economic and financial stability.
- Sound Policies: She stressed the necessity for all countries to pursue sound policies that foster economic stability and growth-oriented structural reforms. These reforms can have a significant positive impact on emerging and developing countries, potentially boosting their output by up to 8 percent over a four-year period.
- Climate Finance: Georgieva urged G20 members to lead by example in fulfilling promises of providing USD 100 billion per year for climate finance. This commitment should be supported by strengthening Multilateral Development Banks (MDBs).
- IMF’s Role: The IMF, through its Resilience and Sustainability Trust (RST), has secured over USD 40 billion to support vulnerable countries in building climate resilience.
- Mobilizing Domestic Resources: She emphasized the importance of countries mobilizing domestic resources to finance and manage the transition to green economies. This can be achieved through tax reforms, efficient public spending, strong fiscal institutions, and developing local debt markets.
- International Cooperation: Georgieva called for increased international cooperation, especially in addressing debt problems. She mentioned the G20 Common Framework and the new Global Sovereign Debt Roundtable as mechanisms to address such issues.
- Strengthening IMF Quota Resources: To enhance the global economy’s strength and resilience, she urged reaching an agreement to increase the IMF’s quota resources before the year’s end. This would enable the Fund to provide interest-free support to the poorest countries through the Poverty Reduction and Growth Trust.
In summary, Kristalina Georgieva’s remarks emphasize the need for countries to pursue growth-oriented structural reforms, prioritize climate finance, and strengthen international cooperation to foster a more robust and resilient global economy.
Source: Address by IMF Managing Director Kristalina Georgieva at the G20 Leaders’ Summit