Transcript of IMF Press Briefing

IMF News, March 21, 2019

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Bibliographic details

• Published: March 21, 2019

Briefing logistics and announcements

• Transcript date: March 21, 2019.
• Press officer: Gediminas Vilkas. Phone: +1 202 623-7100. Email: MEDIA@IMF.org.
• Briefing embargo: embargoed until 10:30 a.m., that's Washington time.
• Spring Meetings schedule and IMF release timeline:
  • April 2: Managing Director Christine Lagarde to deliver curtain raiser speech at the U.S. Chamber of Commerce at 9:30 in the morning, Tuesday, April 2.
  • April 3: Release of Analytical Chapters (issue-focused chapters) of the World Economic Outlook, including chapters on trade and the concentration of corporate power in some sectors.
  • April 4: Release of Analytical Chapters for the Global Financial Stability Report (including a chapter on housing prices) and the Analytical Chapter of the Fiscal Monitor on the fiscal costs of corruption.
  • April 9: Release of the World Economic Outlook; presented by Economic Counselor and Director of Research Gita Gopinath.
  • April 10: Release of the Global Financial Stability Report with Tobias Adrian and the Fiscal Monitor led by Vitor Gaspar.
• Additional upcoming speeches and missions:
  • Christine Lagarde: opening remarks at the Peterson Institute next Monday (on international tax); keynote at Banque de France Symposium marking the 20th anniversary of the euro on March 28; visit to University Paris-Dauphine on March 28.
  • David Lipton (First Deputy MD): speech in Lisbon at the Bank of Portugal IMF Conference on March 25 (on Euro Area reform).
  • Tao Zhang (Deputy MD): in China from March 26 to 31 to represent the Fund at the Boao Forum and participate in Chengdu for the Inter-American Development Bank Annual Meeting.
• Access: Analytical Chapters will be accompanied by briefing materials, webinars, and access to authors; registration for Spring Meetings available on IMF website.

Humanitarian and emergency engagement

• Cyclone Idai: Christine Lagarde expressed solidarity with the people of Mozambique, Zimbabwe, and Malawi in the aftermath of Cyclone Idai; condolences to affected families and friends.
• Operational response: An IMF staff team is now in Maputo to evaluate options for possible IMF support.

Country assessments, program status, and policy guidance

• India
  • Growth: India has been "one of the world's fastest growing large economies," with growth averaging about 7 percent over the past 5 years.
  • Policy priorities and IMF recommendations:
  • Accelerate the cleanup of banks and corporate balance sheets.
  • Continue fiscal consolidation, both at center and state levels.
  • Maintain reform momentum on structural reforms in factor markets (labor, land) and enhance the business climate to achieve faster and more inclusive growth.
  • Forthcoming analysis: More detail to be provided in the World Economic Outlook released on April 9.

• Venezuela
  • Situation: The country faces a very difficult situation with enormous economic and humanitarian tolls.
  • IMF stance: The IMF "stands ready to help once the question of official recognition of the government there has been clarified."
  • Governance and process considerations:
  • Prospective engagement would be predicated on guidance from the international community and IMF membership of 189 countries.
  • At the time of the briefing there was "not yet clarity on that guidance."
  • No schedule or date for an IMF Executive Board meeting on the issue was available; no confirmation of specific consultations referenced by journalists.

• United States
  • Federal Reserve policy: IMF supports the Fed's decision "to be patient in determining future changes to the Federal funds rate" given global uncertainties; emphasizes data dependence and clear communication to minimize market disruptions.
  • Macroeconomic outlook: The U.S. outlook described as "strong" with historically low unemployment, high consumer and business confidence, and aided by the fiscal expansion underway.
  • Further details: To be updated in the World Economic Outlook.

• Argentina
  • Program status: Staff-level agreement on the program reached; Board approval expected "in the next few weeks" following standard sequencing; full staff report to be published at that time.
  • Fiscal assessment:
  • Authorities met the 2018 primary deficit target.
  • IMF view: "Achieving the zero primary deficit this year will require a tight control of primary spending" and will place Argentina's debt to GDP on a decisive downward path.
  • Clarification: The zero primary deficit target is "not a new requirement or a new target" but aligns with the authorities' stated objective for 2019.
  • Social protection: IMF emphasizes it is "critical that the high-impact, social spending programs are preserved" during fiscal consolidation.
  • Political context: IMF states it supports member countries regardless of political complexion and "stands ready to work with any Argentine government."

• Turkey
  • Economic assessment: Turkey’s economy is "slowing sharply" with underlying vulnerabilities remaining.
  • IMF advice: Authorities are urged "to pursue a comprehensive set of policies to credibly and consistently address the key underlying imbalances."
  • Recent actions: IMF staff assessing the possible impact of recently announced tax changes.

• Greece
  • Progress: Reforms implemented have put Greece "on a much better path in terms of sustainability of the economy and growth"; credit given to Greek authorities and people for perseverance.
  • IMF engagement: No financing program currently with Greece, but the Fund will support through analysis, research, and capacity development.
  • Early repayment of IMF loans: Decision is for Greek authorities to make in consultation with other official creditors "where appropriate"; early repayment would reduce interest costs but is a sovereign choice.

• Haiti
  • Program status: A staff-level agreement on a potential program exists but IMF cannot bring it forward to the Board until there is clarity on formation of a new government and the introduction of a budget.
  • IMF request: Resolution of policy and political uncertainties is needed for program processing to resume.

• Tunisia
  • Mission: IMF staff team to be in Tunisia next week for the fifth review of Tunisia’s economic reform program.
  • Assessment: Tunisia has made important progress and is experiencing a modest recovery, but vulnerabilities remain: deficits and debt are large, inflation is high, and foreign exchange reserves are low.
  • IMF recommendations: Strengthen macroeconomic policies and reforms in support of job creation and growth; prioritize social protection for the vulnerable. IMF encourages the international community to step up support to Tunisia.

• Pakistan
  • Negotiations: IMF and Pakistan are "closely engaged" in ongoing discussions; Madame Lagarde has met with Pakistan’s Prime Minister.
  • Missions: A mission to Pakistan is expected "shortly" though no exact date was provided.
  • Financing: No specific amount disclosed; financing decisions will be discussed during consultations.

• Egypt
  • Staff report: The Egypt staff report has "gone through most of the clearance process" and "the Egyptian government supports its publication" — expected "very soon" though no specific date was given.

Trade, tariffs, and analytical work

• World Economic Outlook (WEO) analytical focus:
  • Two Analytical Chapters on trade in the upcoming WEO, one specifically addressing tariffs.
  • WEO will address issues including trade tensions, trade frameworks, the digital economy, intellectual property, and concerns about people being left behind by trade integration.
• U.S.–China tariffs and modeling assumptions:
  • Previous WEO update assumed that tariffs would increase "from 10% to 25% on the 200 billion dollars worth of goods."
  • Negotiations ongoing; the upcoming WEO and Analytical Chapters will provide updated analysis and assumptions.

Key policy messages and priorities emphasized by IMF at briefing

• Support for data-dependent, carefully communicated monetary policy to minimize market disruption.
• For emerging and vulnerable economies: prioritize fiscal consolidation where needed while protecting high-impact social spending.
• Continue structural reforms to bolster growth: banking/corporate balance-sheet cleanup, labor and land reforms, improvements to business climate, and measures to create jobs.
• IMF engagement and program activation are contingent on clear official recognition and guidance in cases where political legitimacy is disputed.
• The IMF positions itself as a partner for capacity development, policy advice, and program financing where requested and warranted by member countries.

Transcript of IMF Press Briefing, March 21, 2019. International Monetary Fund.

References

• People's Republic of China and the IMF
• Arab Republic of Egypt and the IMF
• Argentina and the IMF
• France and the IMF
• Greece and the IMF
• Haiti and the IMF
• India and the IMF
• Pakistan and the IMF
• Republic of Mozambique and the IMF
• República Bolivariana de Venezuela and the IMF
• Tunisia and the IMF
• Republic of Türkiye and the IMF
• Transcripts
• PRESS CENTER
• https://www.imf.org/en/home