During the annual Spring Meetings, the joint World Bank-IMF Development Committee and the IMF’s International Monetary and Financial Committee held meetings to discuss progress on the work of the World Bank and International Monetary Fund. Also featured are seminars, regional briefings and press conferences, focused on the global economy, international development, and the world’s financial markets. The Annual Meetings of the International Monetary Fund and the World Bank Group, organized by The World Bank Group has taken place on 20th April to 22nd April 2018 in Washington, United States Of America. The conference has covered areas like global concern, including the world economic outlook, poverty eradication, economic development, and aid effectiveness. Despite a tentative recovery from the crisis that has seen the Bank and Fund predict a second straight year of global growth, global trends pose regionalised risks in the short-term, and the possibility of medium-term risks to the global economy. In an interview taken in December last year, IMF Managing Director Christine Lagarde admitted that improvements in advanced economies, resulting in rising interest rates, “could very well” trigger a debt crisis in some Sub-Saharan African nations in 2018. Similarly, the Bank warned in its January Global Economic Prospects report that financial markets were complacent about risks posed by rising interest rates. Meetings of the IMF’s International Monetary and Financial Committee and the joint Development Committee were also held which discussed the progress on the work of the IMF and the World Bank Group. Few seminars, regional briefings, press conferences, and many other events focused on the global economy, international development, and the world’s financial markets also remained the subject of discussion.
The International Monetary Fund warned that the rising trade tensions between the United States and China risk undermining a global economy that the IMF believes should otherwise grow solidly this year.
The lending agency has kept its forecast for worldwide growth this year at 3.9 percent, which would be its fastest pace since 2011, But the IMF’s chief economist, Maurice Obstfeld, told reporters that this bright outlook could be derailed by a major trade conflict. Despite expectations that growth will be robust in the near term, developing countries face challenges to keep up the pace of progress and ensure inclusive, sustainable growth amid structural changes to the global economy. The World Bank Group is uniquely placed to address global challenges and help countries achieve their goals in today’s increasingly complex development landscape. This was a key message from the Development Committee, a ministerial-level forum of the World Bank Group and the International Monetary Fund, in a statement issued at the close of the institutions’ Spring Meetings in Washington.
The committee reiterated its support for the Bank Group’s twin goals of eliminating extreme poverty and boosting shared prosperity, while recognizing that the Bank Group must strengthen its financial capacity to meet the aspirations of its shareholders, mobilize capital at scale, and respond to global development challenges. The committee agreed to a capital increase for the International Bank for Reconstruction and Development (IBRD) and the International Finance Corporation (IFC) as part of a package of fundamental reforms that will allow the Bank Group to deliver development results more effectively while becoming more financially sustainable and efficient. It will help the Bank Group continue to lead on global public goods and scale up its support in fragile and conflict-affected situations.
World Bank Group President Jim Yong Kim, in his remarks at the press conference that opened the Spring Meetings, also highlighted the financial strengthening of IDA, the World Bank’s fund for the poorest countries, through an inaugural bond issue that raised $1.5 billion from investors around the world this week. “IDA’s entry to the global capital markets is historic – the latest transformational shift in how we approach development finance,” he said, adding that “IDA will be able to dramatically scale up financing to help countries meet the 2030 development goals, and deliver greater value to shareholders.”
It was reaffirmed that the window of opportunity remains open and should be used expeditiously to advance policies and reforms that sustain the current upswing, enhance resilience, and raise medium-term growth for the benefit of all. It will be continued to use all policy tools to achieve strong, sustainable, balanced, inclusive, and job-rich growth. In line with central bank mandates and mindful of financial stability risks, monetary accommodation should continue where inflation remains weak and be gradually withdrawn where inflation looks set to return to central bank targets. Fiscal policy should be flexible and growth-friendly, rebuild buffers where needed, avoid procyclicality, create space to invest in infrastructure and workforce skills, and ensure that public debt as a share of GDP is on a sustainable path.
IMF also recalled its commitment as a strong, quota-based, and adequately resourced IMF to preserve its role at the center of the GFSN. They revealed that, IMF is committed to conclude the 15th General Review of Quotas and agreeing on a new quota formula as a basis for a realignment of quota shares to result in increased shares for dynamic economies in line with their relative positions in the world economy and hence likely in the share of emerging market and developing countries as a whole, while protecting the voice and representation of the poorest members. IMF call on the Executive Board to work expeditiously toward the completion of the 15th General Review of Quotas in line with the above goals by the Spring Meetings of 2019 and no later than the Annual Meetings of 2019. IMF also noted the progress report to the Board of Governors and showed its concern to look forward for further progress by the time of next meeting. Enhancing cooperation toward reaching the 2030 Sustainable Development Goals (SDGs), debt transparency and sustainable financing practices by both debtors and creditors and addressing debt vulnerabilities in low-income countries (LICs) also were the core and evident points on the agenda. It was also revealed that countries dealing with the macroeconomic consequences of pandemics, cyber risks, climate change and natural disasters, energy scarcity, conflicts, migration, and refugee and other humanitarian crises will be highly supported.
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