Global economic growth “threatened”, departing IMF chief says
Saturday, 21 September 2019
Global economic growth is “fragile” and “threatened”, especially due to trade disputes, the departing Executive Director of the International Monetary Fund (IMF) Christine Lagarde said on Thursday in an exclusive interview with AFP.
Lagarde urged for increased dialogue between word leaders to attempt to “resolve uncertainties,” referring to the trade war between the USA and China that weighs on global trade, or to the Brexit that clouds Europe’s future.
“Whether it be trade disputes, Brexit, technological threats, these are man-made problems that can be settled by man,” she added, noting that “a little femininity would not hurt.”
The IMF lowered its forecast late July for global economic growth to 3.2%. The IMF has since warned that trade tensions could further slow commercial activity.
The Organization for Economic Cooperation and Development (OECD) expects global growth in 2019 to be “the lowest since the financial crisis” in 2008, when it fell to 2.9% before plunging to -0.5% the following year.
Asked about the possibility of her doing more to convince leaders when she takes office as President of the European Central Bank (ECB) in November, Lagarde replied: “I will definitely continue to be determined to ensure that we focus on job creation, productivity, stability.”
However, she also stressed that monetary institutions had to remain “predictable” and “stick to the facts and economic data.”
“There is enough uncertainty around the world without adding doubt about what a central bank will do,” she said.
While US President Donald Trump continues to criticize the Fed and its chairman Jerome Powell, Lagarde recalled how she “constantly” defended the independence of central bankers.
“When I was at the head of IMF, in countries where I saw a central bank governor linked to political aspirations or imperatives, it did not turn out well,” she responded, stating that she was not referring to the United States or Europe but “to smaller countries where the independence of the central bank governor is sometimes threatened.”