Transcript of IMF Press Briefing
IMF News, January 14, 2021
Source details
- Canonical URL
- Transcript of IMF Press Briefing
Other formats
Bibliographic details
- Published: January 14, 2021
Announcements & Work Program
- IMF released its Work Program for the next six months focusing on:
- the response to the pandemic and recovery,
- jobs and growth,
- low-income and most vulnerable member countries,
- building more sustainability and resilience into the economy,
- a major emphasis on climate issues,
- ensuring the Fund remains adequately financed and resourced and updates on ongoing governments' reforms at the IMF.
- The Work Program is issued twice a year and is oriented to priorities facing the IMF’s 190 member countries.
IMF COVID-19 response and financing
- The IMF has provided nearly 103 billion dollars in emergency financing to 83 countries.
- The Fund plans to maintain this effort going forward.
Key events and publication schedule (dates and times preserved)
- Tomorrow at 9:00 am Washington time: Kristalina Georgieva will participate in the Gaidar Forum in a one-on-one conversation on the future of economic growth (held virtually in Russia).
- Monday, January 18th: Managing Director will hold a joint press conference with Magdalena Andersson (Finance Minister of Sweden), who will take up her new role as Chair of the International Monetary and Finance Committee on January 18.
- Monday, January 25th at 8:00 a.m.: Managing Director will participate in the Climate Adaptation Summit (co-hosted by the U.N. and the government of the Netherlands).
- Week of January 25th:
- Tuesday, January 26th: launching an update to the World Economic Outlook.
- That week will also include an update to the Global Financial Stability Report and an update to the Fiscal Monitor.
Country engagements — findings, status, and policy notes
- Argentina
- Discussions with Argentine authorities are ongoing; there was a short break over the end-of-year holiday period and virtual meetings are expected to pick up in the coming weeks.
- Authorities are designing a medium‑term economic plan and discussing specific measures to underpin it and seek broad political and social support.
- IMF view: tackling Argentina's challenges requires a carefully balanced set of policies to foster stability, restore confidence, protect the most vulnerable, and set the basis for sustainable and inclusive growth.
- On the specific export ban on corn: IMF officials stated they have not been in contact with Argentina on this issue.
- Zambia
- Following Zambia's request for a financing arrangement, the IMF's Director of the Africa Department, Abebe Selassie, and Mission Chief for Zambia, Alex Segura-Ubiergo, visited Lusaka in December for high‑level discussions on the economic recovery plan and the request for a Fund‑supported program.
- IMF is assessing how to support that program through possible Fund financing.
- Note: IMF took note of a recent policy announcement for a zero rate value‑added tax on fuel and observed that while intended to protect consumers, such measures tend to be regressive and do not benefit the most vulnerable groups.
- Ukraine
- The IMF has a standby arrangement with Ukraine for US $5 billion to support the authorities' response to COVID‑19 and to preserve economic gains and advance critical reforms.
- The first tranche of that new program of about US $2.1 billion has already been disbursed; the remainder is scheduled over four reviews.
- A virtual IMF mission resumed meetings with Ukrainian authorities on January 11th; the first review of the standby arrangement is ongoing.
- Japan
- IMF expects a gradual recovery in Japan in 2021, with some upside relative to the October World Economic Outlook projection of 2.3 percent.
- Reasons cited: strong third quarter growth and the government's third stimulus package announced in December.
- Short-term outlook: weak economic results expected in the first quarter following a state of emergency imposed from January 8th; recovery expected to pick up in the second quarter supported by pent up demand, restored business confidence, and policy support.
- United States / Global outlook considerations
- The IMF’s October World Economic Outlook baseline assumed the pandemic will be broadly under control globally by the end of 2022.
- Since October WEO: significant progress on vaccine development; the IMF describes a "race between the virus and the vaccine" with diverging recoveries depending on vaccine access and strength of policy responses.
- Third quarter 2020 data were generally better than expected; additional stimulus in major countries will be taken into account in WEO updates.
- India (farm legislation)
- IMF view: the farm bills have the potential to be a significant step forward for agricultural reforms by enabling direct contracting, reducing the role of middle men, enhancing efficiency, and supporting rural growth.
- Caveat: critical to ensure social safety nets protect those adversely impacted during the transition and that the job market can accommodate those affected; growth benefits depend on effectiveness and timing of implementation.
- Kenya
- IMF is in discussions with Kenyan authorities on the possibility of a program to support the next phase of their response to the crisis; an IMF mission visited towards the end of last year and reached agreement in many areas.
- IMF hopes to present something to its Board for consideration in early 2021.
- Policy recommendation: IMF recommended a pause in fiscal adjustment this fiscal year to accommodate increased health spending and support for the economy; recommended continued supportive monetary policy; beyond the crisis, fiscal sustainability and reduction of the fiscal deficit through a well‑balanced policy mix will be critical given increased debt vulnerabilities.
- Press reports referenced a possible $1.5 billion program; IMF confirmed ongoing discussions but did not confirm specific program size in this briefing.
- Costa Rica
- Government requested an IMF program last year; an IMF staff team began virtual discussions the week of January 11th on policy priorities and economic plans that could underpin a potential IMF‑supported program.
- Staff will meet with government officials, parliamentarians, civil society, the private sector, and academics as discussions progress.
- Chad
- IMF stated it is active with the World Bank on debt issues for low‑income countries and Africa, calling for speedy action and support in cases of urgent need; no specific detail on Chad was provided during the briefing.
- Lebanon
- IMF position: important that a new government be formed promptly with a mandate to implement reforms to address the deepening crisis; IMF stands ready to redouble efforts, working with others to support Lebanon and the Lebanese people.
Policy messages and priorities highlighted
- Continued unprecedented and strong fiscal and monetary policy responses are needed to support countries through the pandemic shock.
- Protecting the most vulnerable should be a priority in designing and implementing policy measures.
- Social safety nets may need strengthening when reforms (e.g., agricultural reforms) adversely impact groups during transitions.
- Transparency and fiscal sustainability are central to programs that will follow the crisis period.
- Climate resilience and adaptation are major priorities for the IMF going forward.
Transcript of IMF Press Briefing, January 14, 2021 — IMF Communications Department