Transcript of a Press Briefing by Gerry Rice, Director, Communications Department, International Monetary Fund

September 26, 2013

Washington, D.C.
Thursday, September 26, 2013
Webcast of the press briefing Webcast

MR. RICE: Good morning, everyone, and welcome to this press briefing on behalf of the International Monetary Fund. I'm Gerry Rice, the Director of Communications here at the IMF. As usual, our briefing this morning will be embargoed until 10:30am. That's Washington time. Let me make just a few announcements, and then turn to your questions in the room and also online.

I would like to inform you that IMF Managing Director Christine Lagarde will be making a curtain-raising speech for our Annual meetings, which are due to begin in a couple of weeks' time. And she'll be making that speech a week today; that's on October 3, at George Washington University, at 10:00am. And that event will be open to the press.

I can also tell you that, today, the Managing Director is scheduled to meet with the Prime Minister of Vietnam, and we will have a press release following that meeting.

Turning to our First Deputy Managing Director, David Lipton, he will be taking part in an event at the World Resources Institute here in Washington, for the launch of a new IMF book on energy subsidy reform. And you may recall we had a policy paper on that topic a bit earlier this year, so this is the book. And that's going to be on Thursday, October 3, as well.

Our Deputy Managing Director, Minouche Shafik, will be in Riyadh October 5 to 6, to participate in the Gulf Cooperation Council meeting.

Then, as I mentioned, the Annual meetings will be taking place in a couple of weeks' time, so we're obviously gearing up for that. It may be of interest to you just to note that the analytical chapters of the world economic outlook will be published next Monday -- that's September 30 -- with a press conference that day. And then the analytical chapters of the global financial stability report will be released on Wednesday, October 2 -- also with a press conference.

And there are media advisories online for both of those events, with further detail. Just to wind that up, the launch of those publications themselves -- so not the analytical chapters, but the actual, full-blown reports, the World Economic Outlook -- will be on October 8. And the Global Financial Stability Report and the fiscal monitor will be on October 9. So, please visit our website for the detailed schedule.

And let me make one other plug -- that, for the first time, we have a mobile app for our Annual meetings. It's on iTunes. It's on Google Play. It's free, and we think it's pretty cool, so take a look. And with that, let me turn to your questions.

QUESTIONER: I would like to know, what is the progress that has been made so far, or what are the difficulties used in the discussions between the Greek government and Troika?

MR. RICE: So, as you know, as you indicate, the mission is in the field at the moment, in Athens, discussing with the authorities and the European partners the program's fifth review. They're assessing progress on the economic program. And, really, all I can say at this point is, the outcome will be communicated when the visit concludes.

QUESTIONER: Can you tell us when the mission is coming back, at least?

MR. RICE: Well, as you know, our missions are normally about two weeks. So, this one began on the 17th of this month. We talked about that the last time -- with the principals, Paul Thomsen and others, arriving on the 23rd. So, I don't have a date, but, normally, around two weeks.

QUESTIONER: But can you tell us if the Prime Minister of Greece is going to meet with Madame Lagarde next week?

MR. RICE: Yes, I can confirm that that meeting is expected to take place next week between Prime Minister Samaras and the Managing Director, Christine Lagarde.

QUESTIONER: Do you have a date?

MR. RICE: I will come back to you with a date; I don't have the date for you right now.

QUESTIONER: The Managing Director met with Rohani during the General Assembly, and just wanted to see kind of what you see as the next steps going forward, what the conversation was like, anything else you can share about that.

MR. RICE: On Iran, as you said, the Managing Director did indeed meet with President Rohani on the margins of the U.N. meeting. I think, as we said at the time, the discussion was around global economic developments, the government's economic priorities, and how the relationship with the IMF might be deepened. In terms of next steps, I would expect the discussions to continue during the Annual meetings, when we will have the visit of the Iranian delegation.

QUESTIONER: Just a quick follow-up: when was the last time the Managing Director met with a President of Iran?

MR. RICE: I'll have to look at the history books on that one, Anna. Our last Article IV mission was in July 2011, and we'll dig into the history books for the other one, and get back to you.

QUESTIONER: And then the second question was on Ukraine. I know there's probably not much going on, but I was wondering if the IMF is concerned about some of the possible credit rating downgrades for Ukraine, and kind of its debt and reserve situation, if you're talking with the government about that. I know there's an Article IV coming up, so --

MR. RICE: Well, I was just going to say that, but I don't have beyond what I said last time here, Anna, where we talked about Ukraine a bit.

The technical discussions continue, and the regular Article IV is planned for the fall.

QUESTIONER: Two questions, one on the U.S.: Has the IMF done any sort of estimate of what the impact on the U.S. economy could be of a possible shutdown? Any particular worries, and what it would affect?

Second question: does the IMF have any estimate for effects of Syrian refugees pouring into neighboring countries. I know, like, for instance, the World Bank made a loan to Jordan, to help them shoulder the costs. Do you have anything like this in the works, and any estimates of the impact?

MR. RICE: On the United States, as we have said before, we are hoping that there would be a speedy resolution to the ongoing budget discussions and to the discussions around the debt ceiling. This is important for the continuation of the recovery in the United States and beyond that, in the global economy. You know, I don't have a number for you on what the implications might be.

On Syria, as I said the last time, you know, like everyone else, we're watching the situation -- and, you know, with concern, particularly with regard to the refugee situation. Again, it's too early to make an assessment of the economic impact of what that might be. As this issue progresses, and if we, you know, have something to report in terms of an assessment, we'll get back to you.

QUESTIONER: So, you don't have any loan or anything planned for any of the neighboring countries?

MR. RICE: At the moment, that's all I have.

QUESTIONER: I have a question on the U.S. Some Senators introduced a bill, setting a clear separation between investment and commercial banks. Okay. I was just wondering if the IMF was in favor of such a separation to guarantee a better financial stability.

MR. RICE: Yeah. I don't have anything for you on that. Probably, the best thing is to look back to our Article IV report, the staff report of just, you know, a short time ago -- couple of months ago -- which would have our comments on the financial sector and stability.

QUESTIONER: Can you tell us how the results of German elections will affect eurozone -- and especially Greece -- if you have anything for us?

MR. RICE: Well, we don't comment on political developments, elections, as you know, Michael. Just stepping back, I think we all know the eurozone has made significant progress in recent times, in addressing the crisis, with more to be done on the policy front, in terms of fiscal integration, banking union, and structural reforms aimed at restoring growth and employment. Germany, of course, has played an important role in this effort, and we would expect that to continue. Perhaps I can just go online and take a few questions; then I'll come back inside.

There is a question on Turkey, And the question is: Do you have any changes on your expectations about Turkey's economic data? On that one, I really just have to refer to the mission that's in the field. It's expected to conclude early next week, so I will refrain from preempting the findings of that.

There's a question on Ukraine. I just want to acknowledge it. We've already talked about Ukraine, and so I won't say much more.

There's another question on Pakistan, which I will take. The questioner is asking: There's a strong perception in Pakistan that current, massive local currency devaluation is the result of the recent program with the Fund. What are your comments?

So, just to remind that earlier this month, the IMF's Executive Board approved a three-year, $6.64 billion extended Fund facility arrangement with Pakistan. We are aware that there has been some depreciation of the rupee in recent days. This is not a requirement of the IMF agreement; quite the contrary. Policies under the agreement will help reverse the economic imbalances that are causing exchange rate pressure.

QUESTIONER: Can you tell us when the mission is coming back to Cyprus? And, also, as you maybe know, there is a conflict between the President of Cyprus and the government of the Central Bank. Is Ms. Lagarde aware of this conflict, and what is her position?

MR. RICE: Well, on your last question, we believe that full cooperation between the executive branch and the Central Bank in Cyprus is key to ensure financial stability.

On your first question, the next IMF mission will arrive in Cyprus in late October, to discuss the second review of the program with the country's authorities and with our European partners.

QUESTIONER: You spoke about this last time, but on quotas -- just wondering if you expect that to be a focus of the meetings, if you've heard anything from the U.S. I've talked to the U.S., but curious if you've heard anything else. And do you worry about having this, you know, almost three-year delay in terms of how it could impact the IMF's credibility among some of the emerging markets?

MR. RICE: Significant progress has been made on making the 2010 quota on governance reforms effective. And in terms of the U.S., as you know, the Senate has taken up the legislation. We welcome this step, and we hope for prompt approval. We would expect the issue of quota on governance, of course, to be an issue for discussion for our membership, with our membership, during the Annual meetings.

QUESTIONER: [inaudible]

MR. RICE: Well, you know, the governance reforms are very important for the IMF, for our membership, and, of course, we would want to see these reforms approved and implemented as soon as possible. And that's what we're working towards.

QUESTIONER: There is a discussion lately in Greece about the new austerity measures. Do you think that from the fifth review the designer of the Greek program that is underway might occur the need for new austerity measures?

MR. RICE: You know, again, the missions in the fields, they're in active discussion. It wouldn't be appropriate for me to comment on those discussions. Just to remind -- the goals of the program, of course, are to help Greece restore sustainable growth, and that's what we're all working towards.

QUESTIONER: Could you give us a glimpse on the discussion on Italy, which took place at the Board a few days ago? And I would like, also, to know -- there were some leaks about the GDP growth of Italy. For this year, it would be -1.8 percent. I would like to know if, according to the real figures, it's confirmed.

MR. RICE: Yeah. But we don't comment on leaks as our standard procedure, but I can tell you that, as I mentioned at the beginning of the briefing, the World Economic Outlook is coming now, very soon, and we will have all the numbers in that document. On the Article IV discussion of the Board, the report will be issued very shortly -- imminently, within, you know, the next few days -- and that will have all the detail, including, you know, the sentiment of the Board.

QUESTIONER: I have a question on Ireland. Yesterday, you released new disbursements. And you're saying that the debt ratio would be 123, if I'm correct. Do you see that as a sustainable level for the country?

MR. RICE: Yeah, I don't really have much to add, you know, beyond the press release, Jeremy, that we issued yesterday on that issue. Obviously, the program is aimed at underpinning Ireland's debt sustainability, and so I think the elements included in the program, you know, support that goal.

QUESTIONER: Do you see (inaudible) this 123 percent as a sustainable level?

MR. RICE: Yeah, again, I don't have a specific comment beyond the press release issued yesterday. But, you know, the staff report will be issued in good time, and I'm sure you'll get a bit more detail on that issue then.

QUESTIONER: Sir, if I may -- is the IMF concerned with the latest developments in Greece regarding the Nazi organization, Golden Dawn? And I'm asking you, because many people in Europe believe that the popularity of this Nazi organization is due to austerity measures by Troika.

MR. RICE: You know, like everyone else, we're watching developments. Again, a reminder -- as I said earlier, the goals of the program: to restore growth, keep the growth momentum going, and, hopefully, over time, to, you know, increase employment -- and for the benefit of the people of Greece.

Okay, we seem to have come to the end of the briefing. I want to thank you all for coming today, and reminder -- the Annual meetings in a couple of weeks, and we'll see you at the various press events then.

Thanks very much.

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