Last quote about IMF
All quotes about IMF
Let's hope we close the review in the coming weeks.
As for our friends from the IMF, we like them and it's good to have them on board. But I'm not willing to pay any price for their participation, green-lighting the IMF kind of debt relief–which Greece does not need. We have elections in the Netherlands, France & Germany. I can tell from my experience that Greece is a topic you want to avoid in a campaign.
Fiscal consolidation is a key priority, as loose fiscal policy in the past was a major driver for Mongolia's current economic difficulties and high debt. I think we're looking at a pretty good outlook for Mongolia.
We cannot accept IMF insistence on further cuts in pensions. As minister for pensions I must answer, hoping that IMF managing director Christine Lagarde will listen. Insisting on further pension cuts while Greek pensioners barely have enough to live on is definitely not the way to address public discontent.
Without the IMF, monitoring the bailout would be harder.
The IMF is a very important partner, we want the IMF to be on board. We need to have an agreement including the IMF because it is a guarantee, a security for Greece. But well, we're going to discuss on and on until Monday the 20th of February so as to bring everybody on board and so that everybody feels comfortable with the parameters of what could be a compromise.
The IMF has supervised the rot. Which indicators have shown improvement? None of the targets have been met.
We expect the IMF ... to adopt a more realistic and a more constructive approach in the immediate future. We expect the same from Germany's Finance Ministry.
People think that because there's a Eurogroup next week we have to have it worked out. But that's never been my timeframe. It's unthinkable. The IMF must also be on board.
"People think that because there's a Eurogroup next week we have to have it worked out. But that's never been my timeframe. It's unthinkable,". "The IMF must also be on board".
More to be done. More to be done. No question about that. When it comes to the financial stability, to the ability to supervise, to the strength of those institutions with due accountability - I think it's critically important for the mission that the IMF has, which is financial stability around the world. The more worrying news if you will is that it will have consequences on the rest of the world.
"From the little we hear, we have reasons to be optimistic about economic growth in the United States,". "It is likely that there will be a tax reform, it's likely that there will be additional investment in infrastructure and as a result of that, it is very likely that growth will be up in the US". "That's a tightening that is going to be difficult on the global economy and for which economies have to prepare,".
I know it's not fashionable at the moment, but I think that facts, figures (and) actual assessment of the reality matter and that we have to be honest about it.
We have reasons to be optimistic about growth in the United States.
Yes, it is on a shaky ground in the sense that we don't see how the International Monetary Fund could manage this problem.
There is neither an economic, nor a political reason for this. Greece is a European problem and Europe will solve it.
It's necessary to have some debt relief, because we want to enter the QE (quantitative easing) of (ECB President Mario) Draghi. There are ongoing efforts to reach a deal next week.
We are trying to forge a package that would be a decent compromise. This package, in order to be decent, cannot contain irrational demands like those by the IMF.
"We are trying to forge a package that would be a decent compromise,". "This package, in order to be decent, cannot contain irrational demands like those by the IMF.".
"This package, in order to be decent, cannot contain irrational demands like those by the IMF,"
IMF staff research also shows that, during crises, capital flight is greater in the least transparent countries, which underlines the benefits for financial stability that transparency can bring. Of course, what is good for our 189 member countries is good for the IMF itself. Transparency allows us to contribute to the public debate; it allows the public to scrutinize our work; and it increases our accountability.
The most immediate reason why Italian bonds fell this morning is their close connection to renewed tensions over the Greek bailout terms with new disagreements between the Eurogroup of sovereign creditors and the IMF.
We are saying that Greece needs to take some fairly difficult decisions to make its budget much more growth-friendly.
If you compare what we were a year ago, there is a narrowing of differences of views on debt sustainability and on what is needed.
So it's not like the IMF is saying 'leave the Greeks alone now and give them debt relie.
It's surprising because Greece is already doing better than that report describes. At the end of the current (bailout) programme in mid-2018 we'll look again to see what's possible and what's necessary. But not earlier.
Our aim is to not yield to illogical demands by the International Monetary Fund, which insists on making a central issue the legislating of precautionary [austerity] measures to the sum of 4.5 billion after the programme ends.
The government's position is clear and it has been expressed categorically … our aim is to not yield to illogical demands by the International Monetary Fund, which insists on legislating precautionary (austerity) measures after the programme ends.
The mechanism will help to implement the budget for 2017, replenish fiscal buffers, and improve predictability over fiscal policy. However, a more comprehensive oil framework is needed.
Uncertainties could contribute to financial volatility in the coming months.
The biggest issue for Mongolia is the very low level of FX reserves for financing this year, which is essentially why investors are closely watching out for an agreement with the IMF. Of course, Mongolia could go for other financing options but it is always the uncertainty on each of those options that causes unnecessary volatility.
When necessary, the BOJ should take action. That's why the BOJ's policy may be interpreted as currency devaluation. But the BOJ's policy is clearly aimed at beating deflation and the yen's weakening is just a side-effect. It would therefore be puzzling for anyone to say the BOJ should stop easing. Intervention probably won't be too effective.
I spoke to (IMF Managing Director Christine) Lagarde quite recently and she reassured me that the IMF has still strong intentions to remain part of the programme and to take that step and to participate to the programme in full.
The exchange rate is more depreciated than we expected given the fundamentals.
Although (economic indicators) for December have not been published yet, early indications are that the benchmarks for the next tranche of the loan are likely to be met.
If a fiscally driven demand increase collides with more rigid capacity constraints, a steeper path for interest rates will be necessary to contain inflation, the [US] dollar will appreciate sharply, real growth will be lower, budget pressure will increase and the US current account deficit will widen.
In that scenario, all countries would lose out.
Much of the better growth performance we expect this year and next stems from improvements in large emerging market and low income economies that in 2016 were exceptionally stressed. That being said, compared to our view in October, we now think that more of the lift will come from better prospects in the US, China, Europe and Japan.
At this early stage...the specifics of future fiscal legislation remain unclear, as do the degree of net increase in government spending and the resulting impacts on aggregate demand, potential output, the Federal deficit, and the dollar.
Markets have noted that the White House and Congress are in the hands of the same party for the first time in six years, and that change points to lower tax rates and possibly higher infrastructure and defence spending.
The global economic landscape started to shift in the second half of 2016.
If (the IMF) was to decide for some reason to stop participating, the Europeans could have the idea ... (for) a solution of their own within the European currency system.
In line with these forecasts, economic activity is expected to return to its balance within 2017 and inflation ... to return to its target in 2018. The current deal reached its goals ... A new agreement (with the IMF) will have to be decided after the general elections (in June 2017).
Previous talks with Singapore broke down after Mongolia deemed their lending conditions to be too strict and the interest rates too high. Japan offered financial support, but only through institutions such as the Asian Development Bank or the International Monetary Fund (IMF), assuming Mongolia chooses to comply with the standard rules for engagement.
I am not satisfied with it, but there's a point in time when one has to just stop, turn the page and move on and continue to work with those who have put their trust in me.
I have been held negligent, but without penalty, without sanction, without registration of the decision. I am not satisfied with it, but there's a point in time when one has to just stop, turn the page and move on and continue to work with those who have put their trust in me.
There is a point in time when one has to just stop, turn the page and move on. I am very happy to not appeal this decision and to focus all my attention, all my time, all my efforts, all my energy and enthusiasm to my mission as head of the IMF.
She's a strong leader of the IMF and we have every confidence in her ability to guide the Fund at a critical time for the global economy.
There is no sentence, which means there's no record of this. The result of this last five years is nothing, which leaves us in kind of a complicated and strange situation.
It seemed quite clear for some time that the government had to do something, so this probably comes as a relief, especially if we see positive comments from the IMF (International Monetary Fund). However, multi-month, markets will be focused on how much capital is required from the state and how much can be obtained from the original owners in order to reduce the fiscal burden.
The Executive Board has met on previous occasions to consider developments related to the legal proceedings in France. It is expected that the Board will meet again shortly to consider the most recent developments.
Historically, any time an emerging market won an IMF bailout, stock markets soared - one case study could be India's bailout in 1991, because structural change on both the monetary and fiscal level will eventually be prosperous for the economy.
"Getting these economies of scale could also imply mergers, whether …within the national economies or crossborder …Both are possibilities,"
Getting these economies of scale could also imply mergers, whether ...within the national economies or crossborder ...Both are possibilities.
Greece has already implemented major reforms under the ESM programme and is on track to reach the agreed fiscal targets. It is important that all institutions recognise these achievements of the Greek programme.
The European institutions consider that the policies of the ESM programme are sound and if fully implemented can return Greece to sustainable growth and can allow Greece to regain market access.
We are encouraged by recent high-frequency indicators that show that in the fourth quarter the economy is having good momentum with respect to investment and employment. This creates a good basis for next year. It's not a rounding effect. It has its basis in the solid developments in the fourth quarter.
Greece has already implemented major reforms under the ESM program and is on track to reach the agreed fiscal targets. It is important that all institutions recognize these achievements of the Greek program.
(Lagarde) had a high government position when the decision was made to pursue the arbitration and then not to appeal the award.
They must stop insisting on continuing a policy of extreme austerity which has been proven destructive for society and also economically ineffective.
In our view, the deal is not sufficient to bring Greek public debt on a sustainable footing but political uncertainty might mean the ECB is inclined to include Greek debt (after) a successful second review. The bigger picture though is the IMF, it is crucial for Greece. I mean, maintaining political support from Germany and Netherlands is so important with elections coming up next year in both countries.
The government will continue its effort for a comprehensive deal, if possible by the end of the year.
These must be lowered to give the Greek economy a chance to breathe.
We've made clear that there is no chance we'll accept what the IMF demands on (austerity) measures and labour reforms.
The only source of uncertainty are the questions that arise from the IMF stance and some countries' obsession with its participation in the programme.
The authorities' resolute stance in unwinding the bank bailouts is welcome. Following through all steps until the bailouts are irreversibly unwound will be important to safeguard public finance.
We will be approaching our friends, partners and the donors to fill the gaps, this is what I am expecting because we are talking to the IMF.
The reform's nature was cosmetic to show to the troika (of EU-IMF lenders) that Portugal was taking action.
This means the IMF can't avoid political engagement in countries, exposing it to a backlash if economic transitions prove painful.
People are buying the economic growth expected in the next few years ... Most of the money is transfers from abroad.
What we are witnessing this year is that idiosyncratic risk is driving market performance, and the stock market performance has somewhat decoupled from the movement of oil prices.
The positive reaction following the currency float and with the IMF $12 billion loan inching closer investors shrugged off the global negative sentiment.
Over the past few months, the Egyptian authorities have embarked on an ambitious reform program to put the country's economy on a sustainable path and achieve job-rich growth. I will recommend that the board approve Egypt's request.
Yesterday the central bank governor and I sent the letter of intent. This was the document we still needed to send to complete the procedures.
For the last tens of years we are talking about the exchange rate as a target as an objective. It's the first time ever we talk about the exchange rate as a tool.
There will be relief in the market and with companies that the devaluation has happened. The resetting of Egypt's economic equation has begun at last, but much more needs to be done by the government to reform the economy.
Inflation is already high and it is endemic in Egypt.
All of this will help foster growth, job creation and stronger external position for the country.
We had long and difficult talks with IMF. They are always cautious, but I think we have achieved great results that can make us proud.
If Greece and its partners want to pursue a more ambitious target, we would need to see the reforms that make it add up.
I imagine that within the coming two months and before the end of the year we will have signed the loan.
The protracted nature of these shocks underlines the pressing need to diversify those economies away from their dependence on remittances and commodity exports, so they can more effectively cope with the kinds of economic challenges they're currently facing.
The success of these measures will allow the region to enjoy more sustained and inclusive growth, which will improve living standards and lower poverty rates.
Policymakers need to take important steps toward promoting strong and inclusive growth and job creation, much needed to preserve and improve living standards.
Discussions are under way and the key issue there is the banking sector.
Non-performing loans currently are about half of total loans.
Progress has been made in the discussions and discussions will continue in the coming weeks and we hope the programme can be agreed in the coming months.
Zimbabwe is now current on all its financial obligations to the IMF.
Some countries -- Saudi Arabia, Bahrain and Oman -- start from a position where they have to make more of an adjustment to be able to balance their budget in five years. They all do have policies that they're articulating that will help them get there, but they will entail difficult choices.
The big challenge for Iran is can you sustain that 4-to-5 percent growth over the medium term, or is it just a one-time increase you get? They can, but they have to move on addressing some of the other constraints in their economy.
I don't see there is a lot of scope for postponing fiscal consolidation.
I have just got back from the annual meetings of the International Monetary Fund and the World Bank. I've been going to these meetings for 20 years, and this last meeting I went to is the one in which politics and geopolitics was discussed more than ever.
The sooner they do (IMF talks) the better. They have talked to the World Bank, all the sovereign wealth funds but nobody is interested.
It is an old school orthodox play. How many times are you going to catch a transition like this?
We have not changed our mind on this. This discussion we will have in the coming months.
We clearly think that Germany has some fiscal space and that it should use it, but ... the problem with low growth in the euro zone is mainly structural and requires structural reforms in individual countries.
We should not believe that just to get Germany to do more is going to solve Europe's growth problem.
If the IMF itself is warning against the consequences of ultra-loose monetary policy, I think it's a sign of hope that we will take more seriously what the Bank for International Settlements is saying again, again and again.
I think really we should discuss it ... I will bring it up here at the IMF meetings. There is a limit to what you should and could do in relation to financial stability and as soon as you come close to that you're overstating things.
EM growth is getting better at the margin and a lot of current accounts have moved into positive territory. The difference between EM and developed market growth is growing again.
This could be a bargaining tactic to dissuade some of the free-riders.
I like Latin America which has lagged on the debt side. It is the only region left where you have positive political catalyst.
It will continue to have bumps on the way, but I think it's reasonable to expect that they will remain successful in managing this transition well in a gradual way.
Deutsche Bank, like many other banks, has to look at its business model, which I'm sure it does because it's in the process of selling assets here and there. It has to look at its long-term profitability, given the lower-bound interest rates we have around the world and probably for longer than many expect, and decide what size it wants to have and how it wants to strengthen its whole balance sheet.
A bad settlement is always better than a good trial. We're not in a trial mode clearly in the case of Deutsche Bank but a settlement would certainly be welcome because it would deliver some certainty as to what weight the bank will have to carry and whether it matches with its provisions or not. So the sooner, the better.
More and more, people don't trust their elites. They don't trust their economic leaders, and they don't trust their political leaders.
Yes, I do. As time goes on, it will become clear that unless Germany and the Troika relent, unless there is a debt restructuring, that even the IMF says is absolutely necessary, unless there are these changes in the policy framework, then I think that the only course forward is for Greece to go another way.
Excessive private debt is a major headwind against the global recovery and a risk to financial stability. The Fiscal Monitor shows that rapid increases in private debt often end up in financial crises. Financial recessions are longer and deeper than normal recessions.
Overall, the banking sector seems to be heading in the right direction.
We don't think Deutsche would agree to a settlement that would jeopardize their ability to make their AT1 coupon payments in April 2017.
Given the very, very low financing costs, particularly for a country like Germany, it is certainly the right time to develop infrastructure further. It's not just about Germany, let's face it. Every country can do something.
We'll see what we get from all of these member states, but the initial responses actually make me pretty optimistic.
The geopolitical recession is really just picking up steam. And that's about a lack of global leadership. It's unilateralism from the U.S. and everyone else and it's also the delegitimization of a lot of development governments – the anti-establishment tendencies that we're seeing in the U.S., we're seeing in Europe – it's making it a lot harder for organizations like the IMF to do their jobs.
They need to recognize that political instability and the changes in the political order are going to directly undermine their mandate.
If they are not able to comment on that in the same way that they comment on a country which is not putting policies in place that will allow them to grow or meet the IMF mandate, then you've got challenges.
These types of policies could be particularly useful in China. But in order to work, they need to be adequately designed and subject to strong governance principles.
The IMF said 1.6 percent before summer, now it says 1.3 percent. Its target changes all year long, ours does not. I set a 1.5 percent target, it is a reasonable target that we need to realise and we will work towards that.
Taken as a whole, the world economy has moved sideways. Without determined policy action to support economic activity over the short and longer terms, sub-par growth at recent levels risks perpetuating itself. In short, growth has been too low for too long, and in many countries its benefits have reached too few - with political repercussions that are likely to depress global growth further.
Global growth remains weak.
Being part of the SDR basket at the IMF is quite a ways away from being a global reserve currency.
They earn less money and to be resistant against shocks you have to make more profit, and that's a common opinion from the International Monetary Fund, from the World Bank, from the OECD, from everybody.
We do need more growth in Europe and in the world, without any growth there won't be inflation and without inflation there won't be rising interest rates, so we need growth. But the problem is that at big meetings of the IMF or G-20 we all agree in the declarations that we need to do structural reforms but back home in our countries and national states, we don't do what is necessary – not in Germany nor in other countries.
Adding it all up, the good and the bad, we continue to face the problem of global growth being too low for too long, benefiting too few. If we were to turn our backs on trade now, we would be choking off a key driver of growth at a point when the global economy is still in need of every good piece of news it can get.
It is a deteriorating fundamental story. I don't expect that to change overnight. However some positives may include a change of government and an IMF program.
Summer is over. We really need to restart and pick up on the time lost. And the Greek minister, our Greek colleague, was I think convinced there was a joint interest for all of us to keep this on track. It has very much to do with trust, trust of course between us, trust in the IMF… but also trust from the outside world in Greece and the Greek economy.
I draw a lot of strength and determination from the very strong support from the board,. And I rely on good and solid lawyers who have to do their jobs, so it's not a distraction for me. I focus my energy and time on the mission of the IMF and what I have to do to serve that mission.
It is easy to blame trade for all the ills afflicting a country, but curbing free trade would be stalling an engine that has brought unprecedented welfare gains around the world over many decades.
The fact that Egypt has now reached an agreement with the IMF is an indication that they are taking their economic restructuring, their economic objectives seriously, and that should encourage either friendly neighbouring countries or other bilateral partners to actually participate in the funding.
It is important to move quickly to an international forensic audit. Investors are still interested in investing in Mozambique and this will bring foreign exchange, will bring dollars, but for this we need also the return of confidence.
There is a good chance China asserts its regional influence and offers Mongolia a bigger and better deal than the IMF in a bailout.
With interest rates at historic lows, essentially the government can borrow for free. It has been obvious to almost all economists that increasing public sector investment is sensible. That consensus has been bolstered by the like of the IMF (International Monetary Fund) and OECD (Organization for Economic Co-operation and Development).
I think as long as the U.K. and EU approach Brexit with a cooperative spirit, the outcome can be a good one.
In some areas they're very ambitious, the reforms are very significant … China's policies contribute a lot to the collective G-20 (Group of 20) effort so China is doing a lot [but] I think it's also fair to say that they're not yet doing enough.
The completion of prior actions is not unusual in Fund programs and, while their implementation takes time, they need to be met before the board meeting. The programme is "broadly on track. Subject to this work being completed and prior actions met IMF staff will finalise the preparation of the required documentation for the Executive Board's consideration of the review.
As of June 22nd we were prepared to upgrade our 2016-2017 growth projections slightly. But Brexit has thrown a spanner in the works.
The real effects of Brexit will play out gradually over time, adding elements of economic and political uncertainty. This overlay of extra uncertainty, in turn, may open the door to an amplified response of financial markets to negative shocks.
The first half of 2016 revealed some promising signs – for example, stronger-than-expected growth in the euro area and Japan, as well as a partial recovery in commodity prices that helped several emerging and developing economies. As of June 22 (the day before the U.K.'s Brexit vote), we were therefore prepared to upgrade our 2016-17 global growth projections slightly. But Brexit has thrown a spanner in the works.
We do believe that the growth in the real estate sector is on a dangerous trajectory and needs to slow down.
Cambodia is a fast-growing, highly open economy and just attained lower middle income country status.
The net effect on growth is pretty negligible.
That two things together – the global overhang of indebtedness, private, public and company, together with an ultra-loose monetary policy – maybe is one of the risks we will have to tackle even since we have drawn all the lessons of the financial crisis 10 years ago.
For various reasons, the windfalls from higher growth and lower interest rates were insufficiently used to reduce deficits and debt.
Malawi's macroeconomic situation remains difficult, reflecting weather-related shocks and past policy slippages, which contributed to persistently high inflation.
Accelerating the implementation of public financial management reforms is indispensable to building trust and confidence in the budget process and ensuring control over fiscal operations.
It was a complicated birth tonight. It's probably about as good as it gets.
It will deliver debt sustainability according to our standard criteria.
"I think there is some ground for optimism that this can be the beginning of turning Greece's vicious circle of recession-measures-recession into one where investors have a clear runway to invest in Greece,"
Even if the discussions were long, the atmosphere was always extremely relaxed. This deal is first and foremost a declaration of confidence in today's Greece.
The agreement between Greece and its creditors is positive for risk sentiment and in turn peripheral bond markets.
It was difficult because we are asking a lot of the Greeks, the IMF was asking a lot of us, and we were asking quite a lot of the IMF to step back in.
We achieved a serious breakthrough on Greece which allows us to enter a brand new part within the Greek monetary help program. That is stretching what I assumed would have been attainable not so way back.
Debt relief in the outer years, beyond 2018, could depend on GDP growth, for example, but could not be conditioned on policy measures, since that implies another future programme and that debt is not sustainable with just this programme.
The IMF is flexible, but we have a job to do and the membership looks to us to do that job.
We stand ready to take a program to the board, but ti would need to meet those objectives and principles.
We have exchanged preliminary views with our partners on general principles regarding debt relief. We believe that it is possible to restore debt sustainability without upfront haircuts, although this would involve providing very concessional loan terms, including long grace and maturity periods and very low interest rates.
In a way there is a window for reform at present in Ukraine, which I guess the IMF is eager to push along while it still has leverage.
To ensure their success, the reforms will need to be properly prioritised and sequenced, and the appropriate pace of implementation carefully assessed.
It still seems unlikely that the Fed would move in June, firstly because there may not be enough positive data available to act with confidence, and secondly because to do so would suggest that the U.S. central bank doesn't really consider the U.K. referendum a significant enough tail risk, despite all the siren calls to the contrary, from bodies like the IMF, OECD, World Bank, not to mention President Obama.
It's purely on the IMF deal. The buying came in and we will see this trend continuing for a few more days. But it could be a short-lived one with expected poor earnings while interest rates have been on the rise.
We are not looking at the IMF as a chocolate bar that you eat and how much energy and how many kilometres, miles you can run before you get another chocolate bar. They need to understand that we are equal partners.
Finding exactly what are the solutions, that's where we will have discussions with the IMF. On pension reform, because that needs to be fixed, eventually, the vision of it. And many other areas.
We are in a good shape now.
We just have to be in constant dialogue with them, not blackmailing them. It's the wrong tactic, I hate it. ... This time it will not be like that.
If it's not one system, then some goods that enter Ukraine are just lost or turn out to be something else. What we have is cars coming, but they're sold as teapots. It's a real mess.
No deal is causing uncertainty that the country could again be led to a situation where it won't be able to cover its (financial) obligations.
The crisis of the summer of 2015 is on people's minds.
The insistence of the IMF is affirmed by its refusal to accept the proposal of the Greek government to introduce a fiscal correction mechanism..... and that despite the fact that it met all preconditions set by the Eurogroup last week.
The earthquake was a devastating phenomenon, and obviously we have facilities for countries that suffer natural catastrophes.
I do see in a number of countries action to address the budget deficit. That gives us encouragement and comfort.
Despite all that what does Eurostat tell us? That we had a primary surplus of 0.7 percent instead of the projected 0.25 percent primary deficit. That is to say that we exceeded the programme's target by nearly 1 percent. Let's not forget that at the same time the IMF forecasts were for a 1 percent (deficit) or 0.6 percent (deficit). We exceeded the IMF forecasts by 2.3 billion euros. And we did all this in a difficult year. Nothing happened by chance. Everything happened because we worked with vision, with patience and with persistence.
Greece, which has a primary surplus of 0.7%, does not need extra measures. What Greece needs is an essential debt relief. Greece, in this last turn, needs a push forward not backwards. Those who have made huge mistakes, wrong choices and projections, should not be allowed to repeat their mistakes.
We have done an assessment in the Commission and our judgement is that over this and next year we are likely to see a boost of GDP in the order of 0.2, 0.3 percent growth in Europe being around two percent. This is not negligible.
There was not exactly the same level of anxiety but I think there was an equal level of concern, and a collective endeavour to identify the solution and the responses to the global economic situation.
This is easier said than done. These structural reforms are difficult to pass through parliaments…there is a certain risk that this will be postponed.
There's plenty of work to do so don't expect any immediate outcomes because those things take time. Our position on the Greek economic sustainability and stability has not changed.
In many countries the lack of wage growth and greater inequality have created widespread senses that economic growth has mainly been to the benefit of economic elites.
Where is the US economy at the end of the Obama years and what will be the challenges for the next administration? We are hearing a lot on the campaign trail that the economy is rigged and that the situation is worse than the employment figures suggest. What is your assessment?
We consider the economy to be growing comfortably. It's been growing at about 2.4% and we expect that again in 2016. We consider this to be a solid recovery. Of course, in the future, whoever comes in following President Obama, will inherit a healthy economy, I believe, but faces many long-term challenges. As one is seeing in the presidential campaign, there is a lot of discontent among the US population. The middle class has not been thriving.
The Brexit is for the British voters, and we leave it to the British voters to decide. Given our projections of lower growth this year – that is not going to do well with more uncertainty.
What we are seeing is that thanks to the lower uncertainty about China's economic prospects, self-stabilizing forces are being operated in the foreign exchange market and that has made it a lot easier for the exchange rate to remain stable without the heavy interventions that we saw earlier in the year.
This may seem like a large number, but it is manageable given China's bank and policy buffers and continued strong growth in the economy.
Global growth continues but at an increasingly disappointing pace, that leaves the world economy more exposed to negative risks. Growth has been too slow for too long.
Global growth continues, but at an increasingly disappointing pace that leaves the world economy more exposed to negative risks. Growth has been too slow for too long.
Several large emerging market economies face deep contractions due to internal political strife or geopolitical pressures and a number of low-income countries suffer El Nino-related drought or flooding. The costs could escalate.
Four of the five euro zone bailouts have gone pretty well - an 80 percent success rate. Yet if the IMF walks away from Greece now, everything they've done in Europe will be remembered as a failure.
In terms of trying to achieve more, if we look at Greece, Greece seems to be trouble again and there have been leaks that the IMF has said that bringing Greece to the brink might help push negotiations through. I know you have said that is nonsense, but how close are you to an agreement because it seems pretty far off?
There has been talk that a possible default in Greece could time with Brexit, the referendum in the United Kingdom on leaving the EU. Some at the IMF have allegedly said that would a disaster. What is your take on that?
And if those reforms don't take place what is the IMF going to do?
The IMF has been sounding the alarm bells on that, saying there is a risk of derailment of the global economy. How at risk are we of a 2008-style financial crisis?
The other elephant in the room is China. The IMF has been sounding the alarm bells.
It is not a demand of the federal government to have no debt haircut but rather in our opinion this is legally not possible in the euro zone. The German position is that the IMF takes part in an agreement ... We want a quick conclusion of these talks.
The main driving force is the ECB's increased amount of public sector asset purchases and there's a very favourable supply-demand imbalance this month.
It seems that some people are playing games with an aim to destabilize us. We will not allow (IMF's) Thomsen to destroy Europe.
They need to take a stand on whether they believe our projections or the commission's projections.
I hope for the sake of the Greeks we are going to find a solution soon.
The Greek government is demanding explanations from the IMF over whether seeking to create default conditions in Greece, shortly ahead of the referendum in Britain, is the fund's official position.
The cost of inaction will be costly in terms of global growth. I will argue that esteemed policymakers need to adopt urgently more comprehensive and concerted policy action to strengthen growth and manage financial vulnerabilities.
What is needed is a three-pronged approach through monetary and fiscal policies, as well as structural reforms to strengthen the baseline and guard against the risks.
I have received a letter from Mr. Harris Georgiades, Minister of Finance for Cyprus, informing me of his government's decision to cancel the Extended Fund Facility arrangement, effective March 7, 2016. The Fund's 36-month EFF arrangement was scheduled to expire on May 14, 2016.
No, not in the slightest. It really didn't. If anything it was an impediment, a distraction and an annoyance, a nuisance for me – because I was trying to do a very difficult job. The moment, the day I moved into the ministry I had a Treasury department meeting and I was told that in 11 or 12 days the Greek state goes bankrupt – that we have to chose between either paying the IMF or paying pensions. When you find yourself in that situation all you need to do is get down to work. So the star system and everything you described was a major nuisance.
Egypt doesn't currently have the legal system in place that would be able to attract foreign investment, so even if the IMF approves this $12 billion loan over three years, that doesn't mean foreign investors would rush to come to Egypt, we lack the legal framework and we're also lacking strong infrastructure.
Egyptians are awaiting the outcome of their government's negotiations with the IMF, hoping they will work and can revive an economy that's becoming increasingly troubled day by day, but many people fear the IMF could impose tough preconditions, adding insult to injury.
Francis Malige - International Monetary Fund
We are concerned that many reputable international investors could simply decide to not even investigate the opportunity.
The price was agreed at a government meeting attended by representatives of the EBRD and IMF. The government adopted transparent privatisation conditions, which in particular involve the participation of no fewer than two contenders, including one foreign (contender).
One could think about strengthening and broadening the global precautionary financing instruments that work for everyone. One could also increase the size of the safety net. Over the next few months, the IMF will be considering with our members these and other issues related to the international monetary system.
Look you, Mrs. Merkel, you face a question: you have to think about what is more costly, to go ahead without the IMF–would the Bundestag say 'The IMF is not on board?', or [to] pick the debt relief that we think that Greece needs in order to keep us on board?
What is going to bring it all to a decision point? In the past there has been only one time when the decision has been made and then that was when [the Greeks] were about to run out of money seriously and to default. […] And possibly this is what is going to happen again. In that case, it drags on until July, and clearly the Europeans are not going to have any discussions for a month before the Brexit….
I am not going accept a package of small measures. I am not….
Any of these good laws would have never been adopted if the Ukrainian parliament and government were not so dependent on the international community, on IMF money, EU's visa free regime etc. Now it's time for Ukraine to enforce those laws.
The World Bank and the IMF are in active dialogue with the government of Azerbaijan, discussing both immediate and longer-term measures in response to the pressure on the local currency and low oil prices. The World Bank stands ready to provide necessary assistance to Azerbaijan, including budget support.
I nominated Christine for her first term in May 2011 and since then she has exhibited outstanding leadership, skillfully steering the Fund through big economic challenges, while working hard to deliver historic reforms to the IMF. At a time when the world faces what I've called a dangerous cocktail of risks, I believe Christine has the vision, energy and acumen to help steer the global economy through the years ahead.
The Executive Board has adopted an open, merit-based, and transparent process for the selection of the managing director, similar to the one used in the previous round. Individuals may be nominated by a Fund governor or executive director. Like we did in 2011, we aim to reach a decision by consensus.
The situation is getting worse.
If people are sitting at home for months and years, idle and not working, they are never going to be able to become a fully valued member of Europe society. That is important if we want to protect ourselves from all sorts of unpleasant things.
We have no more than two months to get things under control.
We don't see a big change in the fundamentals in China compared to what we saw six months ago, but the markets are certainly very spooked by small events there that they find hard to interpret. It's not a stretch to suggest that [markets] may be reacting very strongly to rather small bits of evidence in an environment of volatility and risk aversion.
China has been transitioning to a model in which there is less of a dependence on exports, on investment, and more on consumption and services at the expense of traditional manufacturing industries.
Currency management is an area where the Chinese authorities could be communicating more clearly with markets.
If the first week is anything to go by we are in for a long, volatile and very exhausting year. The week started on a bad note and ended on a good one but the market response, worryingly, was the same to both – sell, sell, sell. China has torpedoed the hopes of the optimists. The third leg of the financial crises involving emerging markets that the IMF, World Bank, BIS and various messengers of doom had warned of has come into play.
"The prosecutor said there was no case against Lagarde but the judge has disregarded this". "This decision was taken in disregard of the facts, of the documents of the trial record and of the recommendations of the prosecution authority. It is therefore incomprehensible".
The prosecutor said there was no case against Lagarde but the judge has disregarded this. This decision was taken in disregard of the facts, of the documents of the trial record and of the recommendations of the prosecution authority. It is therefore incomprehensible.
A decision like this is incomprehensible.
I sent her a text, she was really surprised and very disappointed.
We broadly share the programme objectives and the measures needed to reach the objectives. We know there are some differences on assessments, how much effort is needed to reach the fiscal targets … This is bridgeable.
In Greece wrong policies were applied and it is a paradox that those who recognized that there were wrong policies, admitting their mistake, insist on applying the mistake.
The bottom line is the debt will not be repaid in our lifetime.
Four of the five euro zone bailouts have gone pretty well – an 80 percent success rate. Yet if the IMF walks away from Greece now, everything they've done in Europe will be remembered as a failure.
It's smart domestic politics even if it is dumb diplomacy.
It is critical that your authorities ensure an environment that respects the privacy of their internal discussions and take all necessary steps to guarantee their personal safety.
The IMF is gearing up for new clients in the emerging economies. That is not best done by being soft on Greece. They won't go to the (IMF) board to approve participation in a third Greek bailout without something they think is tough and credible.
"Each time Tsipras is going to have to compromise, he needs to create an external enemy,". "It's part of his old populist playbook.
Each time Tsipras is going to have to compromise, he needs to create an external enemy. It's part of his old populist playbook. It's smart domestic politics even if it is dumb diplomacy.
Besides the heartbreaking suffering from conflict and forced migration, there is a human toll from economic dislocation and low activity: More than 200 million people are actually looking for a job and declaring that they are unemployed.
Christine Lagarde gave a rather sober outlook of the global economy, with China and US monetary policy in transition. Once again, she urged all countries to speed up reform – a call that has not been sufficiently heard in the past.
The government's move is aimed at supporting the UAE economy. The reduction in oil prices has slashed government revenues for all the countries in the Gulf region. The IMF forecasts a budget deficit for 2015.
The second leg is that of the lenders, which entails supplying financing and restructuring the debt to ease its burden.
The IMF is an institution which has 188 members, most of them being poorer than Greece and all of them not having had the kind of breaks that some people would like us to give to Greece. So given this, I think it's absolutely essential to respect our rules.
But he also said not to panic. Greece only represents less than half of one percent of the world economy.
I don't take political views. I don't have to face that choice because I don't vote in the United States and even if I did I wouldn't tell you anyway. It is for the people to determine. The IMF is engaged with countries, the IMF is serving the people. The people will decide who their political leaders will be. We have to adjust. We have one focus – it is stability, it is prosperity.
In a nutshell, the main initiator of the memorandum is now confirming the argument of Greek government that the solution they give us doesn't lead to a sustainable exit from the crisis.
That does officially put them in arrears with the IMF, not necessarily a default but arrears… It puts them inside the company of the likes of Zimbabwe.
They are not going to make today's payment. So that does officially put them in arrears with the IMF, not necessarily a default, but arrears puts them inside the company of the likes of Zimbabwe, and so the next important date really is going to be the referendum on July 5th.
Unfortunately, the contingency mechanism that Greece is proposing does not include such reforms.
So, though in a deflationary environment where oil prices remain weak, we have seen the POBC allow its currency to appreciate, to export its inflation. They have decided to continue to appreciate the yuan, also because (possibly) they want to liberalise their currency. So we think the yuan is already an international reserve currency and it's used by many central banks already. We expect this trend to continue as China will keep on pushing this year to have the yuan adopted by the IMF to be one of their currencies.
Any new measures must have the coalition government and parliament's approval, and getting this won't be easy.
But as far as obligations to creditors are concerned, the country disposes only enough reserves to cover the next repayments, not beyond mid-June.
Of course, Asia is impacted by the still weak global recovery, and by the ongoing and necessary rebalancing in China. But domestic demand has remained remarkably resilient throughout most of the region, supported by rising real incomes, especially in commodity importers, and supportive macroeconomic policies in many countries.
The Obama administration tried hard to de-legitimize and marginalize the AIIB – and failed spectacularly. This comes on top of the opposition of the Republicans in Congress to major reforms of the IMF, which would give China a greater voice in the Fund. It is not clear how the US could turn this major diplomatic defeat into something meaningful in the months ahead.
When you combat inequality and you put money in the sectors that are with less income, you have as results not only more welfare for them, but also macro-economically speaking more demand.
Yes, there is a sense of urgency, yes there is a sense of the need to address the issues. And more and more there is a shared conviction that these are economically inconvenient and politically unsustainable issues, and therefore they have to be addressed.
As John F. Kennedy used to say: A rising economic tide lifts all boats. But in today's reality, only yachts go up whereas too many rafts remain stuck in the mud.
The institutions work well and they have to work regardless of time and place, regardless of whether there are elections coming up. And regardless of political affiliation.
Regardless of our political colour, or our social or political level, or the political or economic power that we claim to have, we are all equal in the eyes of the law.
It's clearly not a course of action that would actually fit or be recommendable in the current situation. We have never had an advanced economy asking for payment delays.
The only thing I can tell you is that all state institutions will comply with any legal procedures.
We had a very productive talk in a very good atmosphere with Christine Lagarde. About the Greek government's reform programme, we all know that the Greek government has decided to implement this programme. Greece needs deep reforms.
When there are strong market forces for (currency) depreciation, fighting these forces is a losing battle almost always.
I doubt that's a good solution. That tells everybody that the authorities think there will be continued depreciation. That gives people all the more motive to try to get the money out.
The capital outflow is a symptom of the underlying problems they have to face, not in itself the problem.
Imposing more capital controls at this stage would be the wrong answer.
This is a four-year programme in response to the reforms undertaken in Ukraine and which obliged us not to stop and to move forward.
We are going to have lots of fun. There is no doubt that this will be a very good show.
By the way, the IMF is a contingency plan almost every day when we are called upon helping any of our members in the membership.
Asian countries are playing a bigger role in world finance but these nations remain dwarfs in terms of the IMF and the World Bank. So it is natural that they are trying to react and to change the balance of power.
There won't be any long-term impact, because the IMF is a working institution. There will certainly be a caretaker managing director who will take over from him and, probably, will work along the very same lines.
Dominique must be allowed to defend himself. And I think in the meantime, everyone should respect the basic rules of a functioning democracy that says until one is found guilty one is innocent.
The issues of debt and deficit are secondary to dealing with this underlying structural problems, but if they are dealt with successfully they will produce a future for the Greek economy that will bring satisfaction to Greek people and their partners.
It is technically feasible, which is what the IMF has said. Practically it would be difficult. Politically it's desirable, while financially it's unpredictable.
Definitely, for the markets and for Ukraine's economy overall it would be much better if we got the IMF's support, because IMF help will mean that the government, the authorities will make some reforms which will put Ukraine's economy on a more sustainable footing, and Russian support will mean that we get the money and spend it to repay the gas imported from Russia.
In advanced economies, growth is now too low to make a substantial dent in unemployment and in major emerging markets, growth which had been strong earlier has also decreased.
Politics for me is in the past.
The IMF's forecasts are likely to be lower than our previous forecasts.
The worst would be to call in the International Monetary Fund. We know the measures that would come with that intervention would be very hard on Greece, and it would take time to get back on its feet, and it would look bad for the whole euro zone. So, the best way to get out of this for the moment is probably stepping in together, keeping Greece company to get it out of its deficit.
With public debt so high, in many of the euro area and European countries, the direction has to be down, and not up. But how fast should it go down? We believe that the pace should be measured and steady; measured and steady also means coming up with credible, medium-term durable measures and sticking to them, rather than focusing exclusively and predominantly on the headline deficit targets.
To see the IMF Director General leave the police office in New York handcuffed has profoundly saddened me, I do not understand what has happened, so I am very sad, so very sad.
The selection of the next head of the IMF should be based on 'fairness, transparency and merit', and China and the EU should build an equal partnership.
Concerning the IMF, we are continuing talks about the precise amount and the timing. In a memorandum we discuss the question of $15 billion (almost 11 billion euros). Talks are continuing, the final amount will be clear after signing this memorandum.
We reached an agreement at the level of experts. As soon as the conditions are met, we can expect the board to unlock a new tranche.
Europeans and the IMF can not consider the sixth tranche of the aid program until Greece has adopted the whole package (agreed on) October 27 and until the uncertainty of the outcome of the referendum has been lifted.
At the same time as the European Commission, the International Monetary Fund and the European Central Bank work with these countries, we in the European Parliament are seeing to the reinforcement of the disciplinary rules, and we hope that tougher procedures and sanctions will have a dissuasive effect. I believe far more in persuasion than in sanctioning, which is to say we have tried to improve dialogue between the new Europe and national levels further upstream.
The role of the IMF is, of course, always going to be dealing with some of the major balance of payments difficulties that countries can have, and helping solve those types of problems. The other issues relate to the monitoring that the IMF can do and the early warning systems they can put in place and advancing in those directions is the way to go.
As I said publicly as the chairman of the Eurogroup I'd like to exclude any further involvement of the IMF. What we need is technical assistance from the IMF, but I don't think that the IMF should take a lead, this is a problem of the euro area.
The Eurogroup considers that in principal financial assistance to Cyprus is warranted to safeguard financial stability in Cyprus and the euro area as a whole by providing a financial envelope which has been reduced to 10 billion euro.
The world recovery, which was weak in the first place, is in danger of stalling. The epicentre of the danger is Europe, but the rest of the world is increasingly affected.
The jobs crisis calls for a mechanism to bring forward the gains of structural reforms. That is why we suggest a mechanism, some form of agreement between employers and labour to accelerate hiring and accelerate wage adjustment.
In our view, nothing helps raise demand like a man or a woman with a job and an income. So that's why the focus on wage adjustment, on labour market reform is precisely to produce aggregate demand, that will create people with incomes. Right now you're losing aggregate demand because people don't have a job.
For us it is very important to continue cooperation with the International Monetary Fund and the World Bank. We badly need investment and in order to gain more legitimacy and improve his reputation with Europe, Yanukovych will not clearly steer a course towards Russia.
The eurozone has shown considerable solidarity having already disbursed, together with the IMF (International Monetary Fund) nearly 150bn euros in support of Greece since 2010.
Mr. Lipton, the recovery in Europe hasn't really stalled, but it is pretty weak. And now the IMF forecasts that in 2015 growth in Europe will almost be worse, as in Japan. Why is that so and what is the picture country by country?
What we are saying is that this is the perfect time to be trying to address that problem, because the infrastructure that you would build would have two very important effects: In the long run it would raise the productivity and the growth of the country by providing an infrastructure that could serve the population, it could serve households, it could serve the needs of businesses. But, of course, in the short run the construction of the infrastructure is an added demand. And so this is one policy that both raises demand and supply.
It is taking a very long time for the global economy to climb out of the hole dug by the Great Recession. We are stuck in a painful job crisis with 200 million people unemployed and looking for work around the globe. You know that if the unemployed people were to form a country it would be the 5th largest country in the world.
It's hard to say if the crisis is over.
Greece is still in recession and facing a very difficult, challenging economic environment. Our current projection is that the recession would bottom out some time next year, based on our assumptions that Greece, in the medium term, would return to a realistic growth path.
The only thing that could be done would be to recast the governance of the IMF, the World Bank and the other international financial institutions. But here the solution is very simple, everybody knows it. We need to have a Euro area seat at the IMF with a much smaller share and a much larger share for China.
Christine Lagarde sounded less pessimistic in her assessment of Europe than other observers, like the World Bank. She praised the Europeans for producing results, unlike other regions. She may have been thinking of the United States.
The Commission will be on the ground in Athens in the coming days, in the next couple of days, this week or next week, with experts from the ECB and IMF delegates to verify the implementation and results of these measures.
We analysed the situation yesterday at the Eurogroup, and we will organise a debriefing today. And it's very clear that we will and we want to start a process with the IMF, the Commission and the ECB to analyse the situation in Ireland and to see if it's needed (for) Ireland to introduce a demand for help at the European level.
The UK of course has a very difficult fiscal position on its own. But it's still triple-A rated because the markets still think that the UK in the end will be able to tough it out. The sums the UK might lend to Ireland are really marginal compared to the overall fiscal picture in the UK.
Portugal faces a recession this year, that will continue next year and the number of unemployed will rise from 700,000 to 800,000. If this is the plan, then we already know the outcome and we can anticipate that result based on the calculations of this plan's promoters (the IMF/EU): the result is a tragedy which will destroy the economy.
It is important when disbursing this money that Ukraine commits to reforms. That is, of course, a government that provides inclusiveness. That is a government that is ready to make the best of this support. And I expect Ukraine to sign an agreement with the IMF.
Portugal saw the EU as a kind of El Dorado. The Portuguese now feel a little betrayed by the EU because of the conditions of the troika (EU, IMF, ECB) agreement. At the same time, they know they depend on the EU, because the money needed is coming from the EU and the IMF. I think the fact that Portugal has performed poorly with the euro is not because of the euro. People blame it on errors committed by the Portuguese. The Portuguese weren't able to reach the level required of a currency area like the euro, a currency area with the strength of Germany, for example.
As far as the IMF is concerned, we shall certainly be ready to help and to assist in the design and monitoring of eventual programmes of all conditions that would be part of the solutions.
The IMF projection is of global growth for 2010 of around three percent. It is not that big, but it is a good beginning. But looking ahead, the post crisis world will be, and must be, very different from the one we had before the crisis, and that's why we need to adapt to that reality.
It's important that Greece prove it will take the necessary steps to get back its economic and financial strength in the longer term. It won't take just one year; the IMF usually agrees on three-year programs.
A judgment by the European Central Bank and the International Monetary Fund should make clear that it is all about the stability of the eurozone, meaning the euro.
This new momentum – with hopefully more growth, more jobs, better growth, better jobs – is what we would certainly call upon the [IMF] membership to produce. More growth-friendly fiscal policies can be put in place. Potential labour reforms and fiscal policies adjusted to support job market reforms, which we believe could make a lot of sense.
"I am comfortable with it, Greece will never die. We may just bankrupt the International Monetary Fund too, Greece seems to be good at that."
We have given everything and it still has come to naught. I am afraid of what will happen.
I am comfortable with it, Greece will never die. We may just bankrupt the International Monetary Fund too, Greece seems to be good at that.
We see prospects looking up for the US but we also believe that attention must now turn to the kinds of policies needed to lay the foundation for growth that will be sustainable.
Many are talking about a currency war, myself I think I used this vocabulary, which may be a bit too military, but it's true to say that many do consider their currency as a weapon and that is certainly not good for the global economy.
Developed countries are easing monetary policies, some developing countries are tightening (monetary policies) in response to growth, some surplus countries are intervening to lower the value of their currencies to boost exports, and all this is causing international tensions.
What's important to notice is that even China's response would only offset a part of the shock. It could not offset the entire shock.
China would be more affected by trade than financial channels. That is clear. That is because China has been highly depending on external demand.
We at the IMF have to be technically prepared for anything, because it is our job. But I'm not suggesting that this is a desirable solution. I'm just saying this is within the range of multiple options, one that we have to technically look at, obviously.
I am very happy to see, for instance, that the Chinese just announced a big support on the fiscal side, which is exactly in line with what we asked for almost two months ago and what the G20 communique is explaining.
The International Monetary Fund is an international financial organisation that is governed by the board of directors who represent the leaders of the 'Old World' – the representatives of France, Germany, Great Britain and the United States. If the IMF had coordinated its attitudes within the board, this economically unreasonable demand [to charge domestic gas customers more, as a precondition for the IMF loan] would have been struck from the agenda.
Certainly the recovery is getting stronger, but everybody can understand that it's not the recovery we want. It's not the recovery we want because it's still imbalanced between countries, and it's also imbalanced within countries. That's certainly the reason why uncertainty is still very high.
We believe that a substantial softening of the agreed reforms is not an option for the German government, but we must wait for the report of the troika – the representatives of the European Union, European Central Bank and International Monetary Fund – before judging anything. Rumours about what the report could contain don't count, their report itself does.
This was a summit of delivery, an important step forward on the road to recovery. More work to follow, but Europe – I think we can say it – is showing that it is up to the challenge and that we have been able to come with this coordinated response that we can now bring as a contribution to the global response that is so much needed.
We will discuss what the European Council has been discussing, the action that we can take all together to return the global economy back to growth and to invest in the future and the decisions that we have made today and the extra money that is being released will help ensure that we do everything in our power to return the world economy to growth at the quickest possible opportunity.
Achieving a deficit under 5.9 percent of GDP for 2010 is a key step in the process of fiscal consolidation in Romania, and is the key measure that has helped unlock the reviews of both the IMF and the European Union.
In the beginning, the government took a wrong decision and negotiated the conditions of this loan very poorly with the IMF. Now, because of the IMF policy, we are in a position to put the most pressure to the citizens. In a time of crisis it is not a good idea.
Ironically, this political crisis could actually have a positive influence on the budget deficit parametres. The deficit to GDP ratio is currently forecast to go above 3.0 percent: around 3.1 percent according to the government and around 3.2 percent according to the IMF.
What we want to find out is, given the IMF has given everybody a nod and a wink to end austerity, do we see comments about the need for a medium-term fiscal framework and perhaps some sign that policy will be loosened in France, in Germany, in the Netherlands – core Europe, growing Europe. If they can perhaps ease fiscal policy, then the euro zone as a whole might grow a little better in 2013.
From the year 1944 until 1971, the world had a universal currency without realising it! It was the International Monetary System governed by the IMF, but that was destroyed (with the removal of the gold standard) and instead we got floating rates that have caused so many crises. The advantages of a global currency are: wide financial stability and the removal of transaction costs. Besides it would allow less developed countries, that now have worthless domestic currencies, to have a real currency.
I am coming here to obviously explain my candidacy to the position of managing director of the International Monetary Fund and I am also here to listen to what the Brazilian authorities expect from the fund and from the managing director.
I'm sure that the IMF will take this development into account, and if there wasn't a satisfactory resolution of this matter, it is inevitably going to be an issue for Europe.
In a declaration to the IMF regarding the economic plan from November 2008 it is stated that Icesave will be settled with agreement. This statement was a basic condition for loans from the IMF and Nordic countries. Without those loans the Icelandic economic plan is uncertain.
This is essential now. Greece has delivered and now it's delivery time for the Eurogroup and the IMF.
We have all the possibilities on the table. Consensus is within reach if we are capable of seizing it. If everyone is reasonable, we can do it quite quickly.
Our world is changing and the IMF's role must be to deliver resources to the world, which it needs and which provide a kind of stability, not its entire stability, but a big part of its economic stability, and its mission must be adapted to today's world.
The fight against Ebola has become a race against the clock. As one expert has told us, the virus is on virus time, while the world is on bureaucracy time. The risk is that even as more resources are added, we get further behind.
Let me preface anything that I will say with one presentation, which is what I am wearing here on the side of my jacket. It says: Isolate Ebola, not Countries (…). If more is needed, we will be there, we will partner with those countries, there is no question.
The recovery is still very fragile, the financial system in Europe is still under heavy strain, debt is still too high, both public and private, stubbornly high unemployment is really straining the seams of society, and – to add to the list, as if it wasn't enough, oil prices are clearly another cloud on the horizon.
The country needs a stronger push to fix its public finances in the years ahead, including by curbing the growth of entitlement spending and raising more revenue.
High gas prices are absolutely slowing down our economic growth. Faced with conditions of intense competition they're making some areas very vulnerable – such as metallurgy, our chemical industry, and agriculture because of expensive fertilisers.
Our conditions are clearly known, we believe they are very important. These are conditions on the energy sector, related to gas prices, we also see important fiscal and budget conditions, because we believe it's important that to sustain growth Ukraine has a budget that is consistent with medium-term fiscal sustainability.
We have seen calm return to markets, as eurozone governments have taken more steps on budget tightening and fiscal reforms. Is the worst of the euro crisis behind us or could the situation in Spain and Italy escalate the crisis again?
The risks continue to remain quite elevated. In our World Economic Outlook we actually have a downside scenario that explains how a reintensification of risks would affect the euro area as well as the rest of the world. And it shows that, if there was a re-intensification of the crisis, many countries would suffer.
Even without another European crisis, most advanced economies still face major brakes on growth. And the risk of another crisis is still very much present and could well affect both advanced and emerging economies.
The ECB's policies have been absolutely decisive. Particularly the so-called Long-Term Refinancing Operations that they have deployed. We believe that the ECB needs to stand ready to deploy such operations again, if and when needed. They also need to stand ready to intervene in bond markets with a view to maintaining orderly conditions and thereby facilitate the pass through of the monetary policy to the real economy.
Wolfgang Schaeuble (Germany's finance minister) made proposals so that the IMF (International Monetary Fund) would not have to be called in. In the future, she said, we need a clause in the treaty that would make it possible, as a last-resort, to exclude a country from the euro zone if the conditions are not fulfilled again and again over the long term. Otherwise cooperation is impossible.
With this momentum that the economy is getting into in 2010, we feel comfortable upgrading our forecast and we now project about 9.5 percent growth – GDP growth – for this year.
It's obviously a multi-speed recovery. It appears clearly that in most advanced economies, this recovery, a rather sluggish recovery, still relies on public support and private demand is still very weak.
This will get us out of the crisis probably within the next six months. So it is very important for the banking system to remain on track so that international money and capital markets will open again for the Greece and the institutions as well.
On Ukraine. The financial support of the international community amounts to 27 billion dollars over the next two years, of which $14 to18 bn will come from the IMF – if Ukraine can put in place a very ambitious program of structural reforms. How realistic is this given the massive level of corruption in that country and the continuing military threat from Russia?
You just mentioned that the euro zone economy is growing only very, very slowly, and the IMF forecasts are just north of one per cent for this year and next. If we have a major international crisis on our hands with potentially unpredictable energy problems, can even the small growth rate be sustained? In other words, is Vladimir Putin threatening the recovery in Europe?
Thank you for being with us today on the eve of the IMF Spring Meeting here in Washington, DC. Let me start by asking you about the global context of this year's talks. We have unbalanced growth, massive unemployment, deflation risks, monetary tapering in progress, and all of a sudden we have political instability, not at some distant place in the world, but right on Europe's doorstep. Give us a sense of how all that will shape the discussions at the Spring Meeting?
The Minister of Finance said they will sign the loan before the end of April, and the Minister for International Cooperation and Planning said that we will sign the loan before parliamentary elections, but I say to them: 'You don't have the right to do tha.
We have asked the Fund to monitor and publicly certify every three months the progress of our reforms so that we can show the markets, using the authority of the IMF, that the Italian government is making progress in the implementation of the reforms.
The poll represents the government's failure and this is an attempt to blame it on the people. If this referendum takes place there will be no good outcome. If we vote for the IMF we're condemned and we're also condemned if we return to the drachma.
The country is on the brink of economic and financial bankruptcy. If these reform laws are not accepted we predict default and we predict a 10 percent decrease in GDP.
We've consulted widely in Ukraine across the political spectrum. The Ukrainian authorities have voiced publicly and privately a keen interest in getting their economic house in order.
We don't proceed with programmes if they're deemed to be unsustainable. So the fact that we're proceeding with the programme indicates we don't envisage at this point a debt restructuring.
Raising the gas tariffs which is planned for May could cause an increase in general prices which in turn may lead to discontent among many Ukrainians. The government has promised to create a system which will address subsidies which will in the first instance support low-income groups.
According to the latest report by the International Monetary Fund, Iran's economic growth rate has fallen from 2 percent last year to 0.09 percent. Looking at all Iran's economic indicators over the past eight years, what is your assessment of the country's economy during Ahmadinejad's two terms?
We're seriously worried over the situation in Ukraine. The country is in a deep political crisis, and above all, in a deep economic crisis. I think that is not disputed by anyone. so we want to assist in a political solution of that crisis, without interfering in the internal affairs of the country. On the economic side, we're prepared to work together, with the IMF, with the EBRD (European Bank for Reconstruction and Development) and other international financial institutions to provide assistance. Of course looking into the modalities and conditions.
The emerging markets will only help once two conditions are met. Firstly they must reinforce the firewall, which means doing more than what they're doing with the European Stability Fund. On top of that they must reform the International Monetary Fund.
So we have to streamline the public sector in the manner outlined in my programme and how it's outlined in the agreement that was made with the European Union and the International Monetary Fund.
Global challenges require global solutions. The situation of the financial markets requires an EU response, and building on this response a global approach, that I hope in the coming days we will be able to discuss – with positive results also – with our partners at the G7 and IMF meetings.
The IMF's global agenda is quite ambitious. Whether it can be successful, largely depends on the willingness of the US Congress to ratify the 2010 reforms. Washington has not done so yet. And in an election year this seems less than likely.
We continue to predict negative growth in the eurozone in 2013. This reflects not only negative growth in Spain and Italy, but also lower growth in the core [countries of the region]. We think that the growth will turn positive in 2014 but it will remain very low.
Our expectation is current US monetary policy is consistent with a return to moderate growth.
Obviously a spread of more than 300 basis points together with guarantees from the IMF and the EU, is enough to sell the Greek bonds. But Greece has to pay more than 300 basis points more, which means they won't be able to save the money in the national budget as quickly as they have to spend it via interest on the free market right now.
We are seeing a light recovery, blowing in a spring wind, but we are also seeing some very dark clouds on the horizon – which is another way of saying there is a bit of recovery, timid and a fragile situation with still high risks.
The programme will, in the coming months, employ a number of measures to strengthen the expenditure control of these subnational levels and this will clearly be a key challenge facing the government.
In a recent report the International Monetary Fund spoke of mistakes in the first bailout programme for Greece.
The time has come to rethink the Troika, its composition and role in implementing the bailouts. It is my personal opinion that the task should be left to European institutions in design, surveillance and adjustments, because the objectives of the EU are very different from those of the IMF.
It is an illusion to think that the debt restructuring would help to resolve the problems this country is facing.The debt restructuring will wipe out part or all of the capital of Greek banks. So this is the recipe for catastrophe.
The main message of this year's Spring Meetings is: there not one silver bullet or one global solution to tackle the challenges. What is needed most is confidence and predictability. The markets need to know that policymakers are on the right track.
We need immediately to sign an agreement with the IMF. As soon as a deal on an IMF programme has been signed, money will come for our reserves and we will be able to stabilise the exchange rate.
Christine Lagarde's outlook on the global economy is subdued. As potential risks, she cited the situations in Ukraine and the Middle East as well as the growing Ebola epidemic. None of these threats will go away any time soon.
As we see in the euro area right now, the admission of Greece in 2000 was not based on sustainable factors. And this is what we realize right now in this difficult crisis.
We don't want to pay for private business, private industry and corrupt government. And the people are going to pay. And we are not happy, we don't want the IMF in here. The IMF created this situation and they are in for money and they don't care about the future, they don't care about Ireland.
I think that benefit would only be if the union does not continue with this crazy, German-led, IMF-led, set of economic policies, which means there's a strong core and a very weak periphery in Europe.
It brings in money to us, but to put in a lot of effort just to make sure these people are comfortable is a bit taxing on people who work.
China gives money on condition you buy goods from them. Russia does too – if you stick to their political conditions. The only structure that doesn't impose conditions – is financial markets. They are the most democratic, however, they put all of the risks, both economic and political, into their rates. This is why they're the most expensive.
Ukrainians keep dozens, hundreds of billions of savings in hard currency. Where is this money? Under pillows, in jars. Simple question: why do they keep it under the pillows? The answer is clear: they're afraid. They will keep on hiding this money until the reasons of this fear and the risks are eliminated.
If you have someone who didn't think we had a debt problem in the UK, when we self-evidently do have a debt problem, then they might not be the most appropriate person to work out whether other countries around the world have debt and deficit problems.
We are far from delivering what we should deliver on the recovery plan. The IMF has said to us and the world, each region, each nation need to invest 2% more to the GDP than you otherwise would do this year, and 2% more next year. We are investing this year around half of it in real demand term. So really this European Union needs to do more.
As Italy is the third largest economy in the euro zone, it's important for Italy to be alongside France and Germany to come up with ideas and political proposals to develop the euro zone and find a solution to this crisis and the future of the European Union. At the same time, we want to maintain the good links with EU institutions.
We also consider them to be really initial steps of a process that needs to be deepened and broadened.
We also see deep structural issues affecting growth potential in France due to loss of competitiveness as witnessed in losing market shares faster than some of its European partners and rigidities in labour and product markets.
It is essential that the economic programme currently being prepared (by the European Commission, the ECB and the IMF, together with the Greek authorities) specifies comprehensive fiscal measures and structural reforms that will address the root causes of Greece's fiscal imbalances and structural weaknesses.
I have already said that we have invited Ukraine to take part in the Eurasian Economic Community Crisis Fund. If Ukraine were to join the fund, in general terms, it would be able to receive aid. Moreover, as Russia's representative to the IMF, I have made efforts to persuade the IMF to provide loans to Ukraine.
We have moved from a two-speed recovery to a three-speed recovery. Emerging market and developing economies are still going strong, but in advanced economies there appears to be a growing bifurcation between the United States and the euro area.
Absolutely we do. Yes, we will stick 100 percent with the agreements with the IMF and the European Commission. This is a fait accompli.
Greece has a tradition of armed struggle. It's not only to do with conditions today. These groups existed before the IMF, before the austerity measures, before the serious economic crisis.
What does this woman know about the Greek situation? Why doesn't she say it's Greek ship owners and capitalists who should pay their taxes when they don't – the common people do pay . Those were outrageous words and, from my point of view, if there were any political justice, she should resign.
With regards to the tone of Ms. Lagarde, I had said the tone was unacceptable, offensive. There was a lot of reaction, even on the internet, and Ms. Lagarde was compelled to revise her remarks. I am glad that she has done this because it shows that she has taken into account the reaction of a proud country and a proud people.
We have seen a global crisis and we will be seeing global transitions. We are probably moving from the Great Depression [to] the 'Great Transition'. All these transitions, all these massive changes are not going to be fast, are not going to be easy, and the countries will likely spend the rest of the decade adjusting to the new reality.
I think going forward it's important that the supervisors, the people that supervise banks, make sure that banks behave in a safer way. The international financial community had a project of financial regulatory reform ongoing for several years. I think it is making a lot of progress. We are not satisfied that everything is in place, but it will be very important that new rules are adopted and followed, so that the problems that brought down the world financial system can not recur.
We want the current programme to succeed…The future of the current programme is number one dependent on the Greek government. They have to remain committed to it and continue implementing it.
We are very happy to see that Europe is growing. There is widespread growth, not extraordinarily rapid growth, but still solid: of course there are problems that we all know of in some of the periphery countries.
Notwithstanding the ups and downs of financial markets recently, the global economy is set for another good year in 2007. Our central forecast sees global growth slowing mildly to 4.9% this year, with somewhat slower growth in the United States, continued solid growth in Europe and Japan and continued impressive growth in emerging markets and developing countries, led by China and India.
The next couple of months are crucial and it needs to catch up and deliver tangible results that will demonstrate its commitment to meet the targets that it set out in the IMF and EU agreement.
Stretching out payment terms, for instance in loans from euro area partners and the IMF, is a reasonable thing to think about because we have amortisation right at the end of the programme. This is a technical issue we can think about.
For these offices there should be a broad consensus. India would like to be a part of that consensus. We are working with other countries, particularly the BRICS countries.
The problem Italy is facing is a lack of credibility on the financial markets. This credibility needs to be improved. It's important that Italy not only announces measures, but also that it asks independent institutions – the EU Commission, but also the IMF – to check the situation and to report on it publicly.
According to a spokesman for the European Economic Affairs Commissioner it's possible that the Eurogroup ministers will meet again on October 13th , but the date will be confirmed only when the troika (the EU, the IMF and ECB) come back from Athens. But even if financial default is not declared, the demonstrations in Greece show that social bankruptcy is already a de facto reality.
France and Germany have taken the initiative of bringing together, before the start of the G20 summit, all the European institutions as well as the IMF, to examine with the Greek Prime Minister the conditions under which the commitments made can be honoured.
He was tricked and he has to punish that.
We need to rely on facts, we need to rely on the situation as it is, we do not see anything that is critical, that is worthy of panic at the moment. We would certainly hope that the (Ukrainian) authorities refrain from throwing lots of numbers which are really meaningless until they've been assessed properly.
A key priority is resuming the programme of collaboration with the International Monetary Fund. And we will fulfill all the conditions, I repeat, all the conditions, that are necessary for this loan, and Ukraine's parliament and the coalition will vote for the laws that are necessary for receiving this money.
I think that it's important moving forward that the head of the IMF, the managing director, be chosen on the basis of merit not nationality. But I think for the moment it's important to get someone in there that is capable, that is ready, and Christine Lagarde definitely fits that bill.
The stresses in the euro area affect the UK through many channels, growth is too slow and unemployment – including youth unemployment – is too high. Policies to bolster demand, before low growth becomes entrenched, are needed.
It's clear we are now reaching a critical point for the eurozone. The eurozone countries need to stand behind their currency, or face up to the prospect of Greek exit. The British government is doing contingency planning for all potential outcomes; it is our responsibility to ensure that while we work for the best, we prepare for something worse.
We are prepared to continue to support an effective strategy in Europe, with the IMF. And if there is a compelling case for more IMF resources, more use of the existing resources of the IMF, alongside a more effective substantial European strategy, then we will be supportive of that.
We are not going to rest until the confidence that was placed in us is returned. I want to assure you that we are doing all that is in our power, with the European Commission, the European Central Bank and the International Monetary Fund, so that the austerity programme in Portugal is a success.
The lower the inflation rate, and … the larger the deflation rate, the more dangerous it is for the euro recovery.
I am not a candidate and the reason I am not a candidate is that I have a job (…) and which I intend to complete. As my young son would have said: 'Mum when you start something you've got to finish the job.
On the consequences in southern Europe, or more extensively eastern and central Europe and the large periphery of Europe, it is clearly this immediate circle that is potentially exposed, which is why it's so important that the Europeans do what they're committed to do and that they deliver on their programme.
There are many things that our friends in the IMF don't take into account. For example, during the discussions which were aimed at avoiding the bailout, even in the banking resolution, they did not take natural resources into consideration. I believe that the keys to disproving the IMF's bad forecasts will lie in the cooperation over natural gas that we are pursuing with Israel, the strengthening of relations and co-exploitation in some sectors.
That's important to recall that at the same time the Commission together with the ECB and IMF and the Irish authiorities are working in order to resolve the serious problems of the Irish banking sector.
We have revised downwards our growth forecast and that is largely attributed to the poor results of Q1, which are largely but not entirely weather-related. We believe that this slowdown is temporary and better prospects lie ahead.
You want to raise taxes and reach consensus with us, who have set reducing taxes as a priority? Don't even think about it. Lower tax rates are the key to starting the engine of the Greek economy. If you raise taxes, there will be no room for consensus or for renegotiation.
The euro area and other member states will aim to make available additional ressources of up to 200 billion euros to the IMF. The EFSF (European Financial Stability Facility) leverage will be rapidly deployed and we also agreed on the acceleration of the entry into force of the ESM (European Stability Mechanism) rescue fund. It should enter into force in July 2012.
If you were to ask me what we expect from this IMF annual meeting: we expect action and we expect courageous and cooperative action on the part of our members.
In our judgement, once the evidence is reviewed, it will be clear that there was no element of forcible compulsion in this case, whatsoever.
Greece has the potential to access a significant amount of EU money under cohesion policy. We should concentrate these funds on where it matters… we should find ways to front-load and accelerate them, so that Greece gets the benefit now.
My own sense is we have a strong consensus on the basic framework of objectives but we worked very hard in the last weeks and months to get countries to agree to a set of objectives and timetable to put these reforms in place.
We've said before that the proposed standby arrangement would be in the range of 14 to 18 billion dollars over a two year period.
We would really hope to see a change, in the sense that the next person should be selected on merit and that the Europeans should realise that while they are the biggest shareholders, they are also the biggest debtors now so they no longer have the right to nominate that person.
More monetary easing, including through unconventional measures, is needed in the euro area.
In 2013, global growth was about 3 percent; we project modest improvements in 2014 and 2015, although still remaining below past trends. The risk is that without sufficient policy ambition, the world could fall into a medium-term low-growth trap.
So far, I have not received any kind of request from the Irish authorities and I think they can manage alone. If, at one point in time, tomorrow, in two months, in two years, the Irish want some support from the IMF, then, of course, we will be ready as for all of our members.
We won't rest until we have repaid the trust put in us. I can assure you we are doing everything in our power, with the European Commission, the ECB and IMF to make a success of the austerity programme.
Washington cannot make bilateral loans available to the IMF without Congress approving it. There's no chance of that and the US government has always made that clear.
I am waiting for the IMF and independent valuers to give a figure they think is needed to recapitalise Spain's financial system. Then I'll produce my own numbers, and the government will decide what sum is needed.
There would be very negative consequences for the US economy, and there would be very negative consequences outside the US economy. We are likely to see, if that matter is not resolved, volatility, uncertainty, and consequences for the rest of the world.
Elections must be held,'' Croitoru said. It's also important that we continue our financial relations with the world bank, the IMF, the EU and financial institutions.