{
  "title": "New Economic Landscape, New Multilateralism",
  "publication": "IMF News, October 11, 2018",
  "sourceUrl": "https://www.imf.org/en/news/articles/2018/10/11/sp101218-new-economic-landscape-new-multilateralism",
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  "summary": "Speech by Christine Lagarde, Managing Director, International Monetary Fund, as prepared for delivery on October 11, 2018.",
  "authors": [
    "Christine Lagarde"
  ],
  "publishDate": "2018-10-11",
  "sections": [
    {
      "heading": "Context and framing",
      "content": "- Speech by Christine Lagarde, Managing Director, International Monetary Fund, as prepared for delivery on October 11, 2018.\n- Purpose: Address the IMF 2018 Annual Meetings in Bali; present the concept of a “new multilateralism” to respond to a changing global economic landscape.\n- Two-dimensional framing of the new economic landscape:\n  - First dimension: monetary, fiscal, and financial layers.\n  - Second dimension: inequality, technology, and sustainability.\n- Core claim: Sound domestic policies are essential but insufficient; navigating the new landscape requires international cooperation that is “more inclusive, more people-centered, and more results-oriented.”"
    },
    {
      "heading": "Macroeconomic challenges and policy implications",
      "content": "- Trade\n  - Trade cooperation has driven unprecedented growth over 70-plus years but faces a backlash because “too many people have been left out.”\n  - IMF estimate: escalation of current trade tensions could reduce global GDP by almost one percent over the next two years.\n  - Policy recommendation: De-escalate disputes and reform the global trade system “to make it even better, fairer, and stronger for all nations and all people.”\n- Global imbalances\n  - Large current account deficits mirror large current account surpluses.\n  - Policy recommendation: Excess deficit and surplus countries must cooperate to protect economic stability; IMF External Sector Report underscores this point.\n- Rising vulnerability to debt\n  - Statistic: Public and private debt has hit a record $182 trillion—224 percent of global GDP, about 60 percent higher than 2007.\n  - Risk: Tighter financial conditions could reverse capital flows, especially for emerging markets, with spillovers across borders and real impacts on people.\n  - Policy recommendation: Complement domestic policies with a global financial safety net; resources could come from regional financing arrangements (example: the Chiang Mai Initiative) and the IMF; ensuring the Fund has needed resources requires international cooperation.\n- Cross-cutting IMF roles\n  - Cooperation runs through the Fund’s work in lending, surveillance, and capacity development.\n  - Areas of policy advice and support include financial regulatory reform, public debt transparency, capital flow management, and anti-money laundering.\n  - Argument: In a hyper-connected world, no country can manage these issues alone; cooperation is in the Fund’s DNA."
    },
    {
      "heading": "21st-century challenges: inequality, technology, and sustainability",
      "content": "- Inequality\n  - IMF research: Less inequality is associated with stronger, more sustainable growth; excessive inequality correlates with marginalization, damaged communities, and eroded trust.\n  - Policy recommendations: Partnerships among governments, private sector, and civil society to eradicate discrimination against women; design appropriate labor market reforms; strengthen education, training, and social protection systems to include people and prepare them for technological change.\n- Technology\n  - Observation: The digital revolution (biotech, robotics, artificial intelligence) will create new industries and jobs but also disrupt and disenfranchise.\n  - Fintech opportunity: Potential to reduce poverty by providing financial services to the 1.7 billion people who currently have no banking access (Global Findex Database, 2018).\n  - Caution: Fintech must be managed carefully to protect financial stability and safety; digital is global and requires multilateral coordination.\n  - Action: Launch of the Bali Fintech Agenda at the Meetings (with the World Bank and other partners) to guide joint efforts.\n- Sustainability and SDGs\n  - Climate change: Increasingly negative effects require common action.\n  - SDG financing gap: Additional spending needed by low-income countries in key sectors (health, education, water, infrastructure) is about $520 billion per year by 2030.\n  - Policy recommendations: Partnerships among countries, private sector, donors, international institutions, and philanthropists; more efficient resource use; strengthen revenue collection (including curbing tax avoidance and evasion); stamp out corruption.\n  - Framing: Solidarity on inclusion and climate action is both moral and in self-interest because tensions from exclusion and climate change cross borders.\n- Principles of the new multilateralism\n  - Must be more inclusive (open to diverse views and voices).\n  - Must be more people-oriented (putting human needs first).\n  - Must be more effective and accountable (delivering results for all).\n  - The IMF positions itself “at the heart of this new multilateralism.”"
    },
    {
      "heading": "Institutional and human elements",
      "content": "- Acknowledgements in the speech:\n  - Recognition of Indonesian hosts and ASEAN leaders; references to Indonesia’s economic progress and resilience following natural disasters in Lombok and Sulawesi.\n  - Thanks to IMF Management, Executive Directors, staff, and retiring Economic Counsellor Maury Obstfeld for leadership and commitment to multilateralism.\n- Outreach and inclusion\n  - Example of youth engagement: Winning photos from an IMF Instagram contest among ASEAN youth were shown to highlight anxieties and hopes of the rising generation.\n  - Message: The new multilateralism is about the future of young people."
    },
    {
      "heading": "Conclusion: Consider the common good",
      "content": "- Closing exhortation: Quote from the Bhagavad-Gita, 3:20—“In all actions, consider the common good.”\n- Core appeal: Commit to the common good so that cooperative multilateral work benefits current and future generations.\n- Final message: The “offering” of collective work at the Annual Meetings should return blessings that benefit not only this generation but generations to come.\n\nSource: Speech by Christine Lagarde, “New Economic Landscape, New Multilateralism,” IMF, October 11, 2018.\n\n---\n\n\n References\n\n- Christine Lagarde\n- Indonesia and the IMF\n- Speeches\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2018/10/11/sp101218-new-economic-landscape-new-multilateralism"
    }
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    "Authors: Christine Lagarde",
    "Published: October 11, 2018",
    "Speech by Christine Lagarde, Managing Director, International Monetary Fund, as prepared for delivery on October 11, 2018.",
    "Purpose: Address the IMF 2018 Annual Meetings in Bali; present the concept of a “new multilateralism” to respond to a changing global economic landscape.",
    "Two-dimensional framing of the new economic landscape:",
    "Core claim: Sound domestic policies are essential but insufficient; navigating the new landscape requires international cooperation that is “more inclusive, more people-centered, and more results-oriented.”",
    "Trade",
    "Global imbalances",
    "Rising vulnerability to debt",
    "Cross-cutting IMF roles",
    "Inequality",
    "Technology",
    "Sustainability and SDGs",
    "Principles of the new multilateralism",
    "Acknowledgements in the speech:",
    "Outreach and inclusion",
    "Closing exhortation: Quote from the Bhagavad-Gita, 3:20—“In all actions, consider the common good.”",
    "Core appeal: Commit to the common good so that cooperative multilateral work benefits current and future generations.",
    "Final message: The “offering” of collective work at the Annual Meetings should return blessings that benefit not only this generation but generations to come.",
    "[Christine Lagarde](https://www.imf.org/en/About/senior-officials/Bios/christine-lagarde)",
    "[Indonesia and the IMF](http://www.imf.org/external/country/IDN/index.htm)",
    "[Speeches](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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