The Great Reset
IMF News, June 3, 2020
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Bibliographic details
- Published: June 3, 2020
Remarks overview
- Title: The Great Reset
- Speech by Kristalina Georgieva, Managing Director, IMF
- Event: Remarks to World Economic Forum
- Date: June 3, 2020
- Delivered on behalf of the IMF Communications Department
Immediate outlook and risks
- Finding: "One hundred and seventy countries are going to finish this year with a smaller economy than at the start of the year."
- Projections/risks highlighted:
- "more debt"
- "bigger deficits"
- "more unemployment"
- "a very high risk of more inequality and more poverty"
- Contingency: "Unless we act."
Objective: define the Great Reset (IMF perspective)
- Core goal: ensure recovery leads to "a greener, smarter, fairer world."
- Imperative: "We don’t need to wait." Act now and "concentrate on the key elements of a recovery."
Green growth (policy directions and opportunities)
- Policy recommendations:
- Governments to implement public investments and incentives for private investments that support "low-carbon and climate-resilient growth."
- Use opportunities for "job-rich recovery" through activities such as "planting mangroves, land restoration, reforestation or insulating buildings."
- Invest in key sectors for reducing carbon intensity where both public and private sectors can invest.
- "Take advantage of the low oil prices we see today, to eliminate harmful subsidies and introduce a carbon price that would work as an incentive for future investments."
Smarter growth (digital economy and inclusion)
- Observations:
- "We know the digital economy is the big winner of this crisis."
- Risk: the digital divide may widen, causing some countries and communities to "fall further behind."
- Policy recommendations:
- Institutions like the IMF should "support investments that will shrink the digital divide—working in partnership with the World Bank and others."
- Ensure that "the jump in growth and profitability in the digital sector leads to benefits that are shared across our societies."
Fairer growth (social protection and inclusion)
- Observation: "if left to its own devices—this pandemic is going to deepen inequality. That has happened in prior pandemics."
- Policy focus:
- "Investing in people—in the social fabric of our societies, in access to opportunities, in education for all, and in the expansion of social programs so we take care of the most vulnerable people."
- Objective: create "a world that is better for everyone."
IMF role, capacity, and historical parallel
- Institutional capacity: IMF has "a one trillion-dollar financial capacity and tremendous engagement on the policy side."
- Historical example cited:
- William Beveridge's 1942 report addressing the "five giant evils," which led to postwar reforms including "the creation of the National Health Service."
- Parallel drawn: IMF was created at the Bretton Woods Conference.
Closing message
- Call to action: "Now is the moment to step up—and use all the strength we have—to turn the page."
- Desired historical judgment: ensure "history will look back on this as the Great Reset, not the Great Reversal."
- Dedication: "the best memorial we can build to those who have lost their lives in the pandemic is to build a world that is greener, smarter and fairer."
- Closing: "Thank you."
Source: Remarks by Kristalina Georgieva to the World Economic Forum, June 3, 2020.