Global Biz

IMF calls for country-specific exits from stimulus

(Xinhua)
Updated: 2010-04-25 09:41

WASHINGTON - The International Monetary Fund's policy-steering body, the International Monetary and Financial Committee (IMFC) Saturday called for the implementation of country-specific exits from stimulus, and pledged to deliver on the long-expected quota and governance reform.

International Monetary Fund First Deputy Managing Director John Lipsky, International Monetary Fund (IMF) Managing Director Dominique Strauss-Kahn and Egyptian Minister of Finance and Insurance Youssef Boutros Ghali (L-R) give a press conference after the International Monetary and Financial Committee (IMFC) meeting in Washington D.C., capital of the United States, April 24, 2010. [Xinhua]

COUNTRY-SPECIFIC EXITS FROM STIMULUS

"The worst is definitely behind us. But, we are not out of the woods yet. We see a strengthening of economic recovery, but we also see an unevenness in this recovery, unevenness within countries, and unevenness between countries," Youssef Boutros- Ghali, IMFC chairman and Egyptian Minister of Finance, said at a press conference after a meeting of the committee in Washington.

IMF Managing Director Dominique Strauss-Kahn echoed his view on the same occasion, saying that recovery has been faster in Asia and more sluggish in other parts of the world such as Europe and Japan.

"We will continue to work to phase in country-specific exits from stimulus, recognizing the diverse pace of recovery and potential spillovers across countries and regions," the committee said in a communiqu issued after its meeting, which is part of the IMF/World Bank spring meetings.

The communiqu echoed a Friday statement of the G20 finance ministers and central bank governors, who said stimulus measures should be maintained in economies where growth is still highly dependent on policy support until the recovery is firmly driven by the private sector and becomes more entrenched.

STRENGTHENING THE FINANCIAL SECTOR

Noting that problems in the financial sector were at the heart of the recent crisis, the committee said: "Strengthening financial regulation, supervision, and resilience remains a critical but as yet incomplete task."

"We agree to redouble efforts to forge a collaborative and consistent approach for a stable global financial system that can support the economic recovery," said the committee.

It said it is looking forward to the completion of reviews under the Financial Sector Assessment Program of countries with systemically important financial systems and support continued efforts to map systemic risks and transmission channels.

On the controversial bank tax, the committee said the IMF is working on "a range of options on how the financial sector can make a fair and substantial contribution to cover the burden" of strengthened regulation.

"If you want really to decrease the likelihood of the crisis, if you want to curb the behavior, I need to have different tools," said Strauss-Kahn.

He stressed that the bank tax should not replace but goes together with regulation.

Previous Page 1 2 Next Page