Make reforms while sun shines on world economy: Lagarde

Christine Lagarde said Europe is ‘not united on moving toward greater integration’ (AFP)
Updated 31 December 2017

Make reforms while sun shines on world economy: Lagarde

PARIS: International Monetary Fund Chief Christine Lagarde has urged France and other countries to push through reforms “while the sun is shining” on the global economy.
In an interview with France’s Le Journal du Dimanche published Sunday, Lagarde said the strength of the global economic recovery had taken the IMF by surprise.
“In 2017, for the first time in a long time, we revised our growth forecasts upwards whereas previously we used to lower them,” she said.
Global growth of 3.6 percent was both “stronger and more widely shared” in 2017, she said, noting that developed economies were now growing again under their own steam and no longer merely being pulled along by demand in emerging markets.
Lagarde said the favorable climate lent itself to implementing reforms.
“When the sun is shining you should take advantage to fix the roof,” she said, using one of her favorite maxims.
This year’s global growth is on a par with the average of the two decades leading up to the global financial crisis.
The IMF has forecast a further slight improvement in 2018, to 3.7 percent.
In Lagarde’s native France, seen for years as one of Europe’s weak links, the recovery kicked in in earnest this year.
From 1.1 percent in 2016, growth is expected to rise to 1.9 percent in 2017 — still short of the 2.4 percent forecast for the euro zone as a whole but better than the 1.6 percent initially forecast in the eurozone’s second-largest economy.
Centrist President Emmanuel Macron aims to consolidate the momentum and bring down stubbornly high unemployment with an ambitious program of labor, tax and welfare reforms.
Lagarde said the changes were key to boosting France’s credibility at a time when Macron is pushing for reforms at the European level, including closer integration among eurozone members.
The managing director of the IMF was France’s finance minister in 2008, when the euro looked to be in serious jeopardy.
Nearly 10 years later, the currency is out of the woods.
But, Lagarde warned, “the mission has not been accomplished — and maybe never will — because Europe is not united on moving toward greater integration while maintaining national sovereignty.”


Trump calls for World Bank to stop lending to China

Updated 07 December 2019

Trump calls for World Bank to stop lending to China

WASHINGTON: US President Donald Trump on Friday called for the World Bank to stop giving loans to China, one day after the institution adopted a lending plan to Beijing over Washington’s objections.
The World Bank on Thursday adopted a plan to aid China with $1 billion to $1.5 billion in low-interest loans annually through June 2025. The plan calls for lending to “gradually decline” from the previous five-year average of $1.8 billion.
“Why is the World Bank loaning money to China? Can this be possible? China has plenty of money, and if they don’t, they create it. STOP!” Trump wrote in a post on Twitter.
Spokespeople for the White House and the World Bank did not immediately respond to requests for comment.
The World Bank loaned China $1.3 billion in the fiscal 2019 year, which ended on June 30, a decrease from around $2.4 billion in fiscal 2017.
But the fall in the World Bank’s loans to China is not swift enough for the Trump administration, which has argued that Beijing is too wealthy for international aid.