IMF Managing Director Urges Global Cooperation for Global Challenges

IMF News, February 23, 2020

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Statement issued by Ms. Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), at the conclusion of the G20 meeting of Finance Ministers and Central Bank Governors in Riyadh, Saudi Arabia.
Date of statement: February 23, 2020.
Context: global growth had "appeared to have bottomed out" with signs of stabilization and expectation of a modest rebound.

Growth projections cited:
- "2.9 percent last year"
- "3.3 percent this year"
Factors that supported tentative stabilization:
- continued monetary easing
- in some countries, fiscal easing
- the Phase 1 trade deal between the US and China
Downside shocks and risks highlighted:
- COVID-19 virus: described as "a global health emergency" that has disrupted economic activity in China and "could put the recovery at risk"; even with rapid containment, growth in China and the rest of the world would be impacted.
- High debt levels in countries and corporates could be affected by a rise in risk premia or an unanticipated tightening in financial conditions.
- Climate change associated with an increase in the frequency of natural disasters.
- Trade tensions: "trade tensions have shaved 0.6 percent off this year’s global GDP."

Monetary policy:
- "With slow growth and low inflation, monetary policy should remain accommodative in most G20 economies."
Fiscal policy:
- "Fiscal policy should also be deployed—where space allows—to support economic prospects;"
- Fiscal measures "does not have to be costly and could be done through reprioritizing spending toward high-return infrastructure and investment in people."
Structural reforms:
- Implement structural reforms "to boost productivity, growth, and jobs."

Global challenges require global solutions; items discussed in Riyadh included:
- addressing tax challenges from the digitalization of the economy
- strengthening debt transparency and sustainability
- building a more open and resilient financial system
- enhancing access to opportunities, especially for women and youth (supported the Saudi Presidency’s agenda)
Three highlighted areas where cooperation is key:
- Contain COVID-19:
- "We must work together to contain COVID-19—both its human and economic impact—especially if the outbreak turns out to be more persistent and widespread."
- IMF readiness: the IMF "stands ready to help, including through our Catastrophe and Containment Relief Trust that can provide grants for debt relief to the poorest, most vulnerable countries."
- Reduce uncertainty over global trade:
- Move "from trade truce to trade peace."
- Scale up climate change mitigation and adaptation.

COVID-19 viewed as "a stark reminder of our interconnections and the need to work together."
The G20 described as "an important forum to help put the global economy on a more sound footing."
Expression of thanks: "I would like to thank Minister Mohammed Al Jadaan and Governor Ahmed Abdulkarim Alkholifey for the excellent organization of our meeting and their warm hospitality."

IMF Press Release No. 20/62 — February 23, 2020.