## Opening Remarks at the Eighth Tokyo Fiscal Forum

_IMF News, June 6, 2023_

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## Bibliographic details
- Published: June 6, 2023

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### Introduction
- Speaker: Mr. Kenji Okamura, Deputy Managing Director, IMF
- Date: June 6, 2023
- Event: Eighth Tokyo Fiscal Forum — first in-person forum since 2019
- Co-organizers acknowledged: Japan’s Ministry of Finance and the Asian Development Bank Institute
- Purpose of in-person format: strengthen relationships and build social networks

### Topics of the forum
- Two main themes:
  - The Relevance of the Fiscal-Monetary Policy Mix for Disinflation
  - Global Cooperation and Climate Change

### Fiscal-monetary policy mix — findings and implications
- Context:
  - Inflation upsurge since 2021 required immediate tightening of monetary policy.
  - Fiscal policy can support monetary policy in disinflation efforts.
- Empirical finding from the IMF’s Fiscal Monitor:
  - "one percentage point of GDP in additional public spending resulted in higher inflation of 0.5 percentage point from 1986–2019."
- Policy implications and priorities:
  - Fiscal consolidation sends a powerful signal that macro-economic policies are aligned in the fight against inflation.
  - Need to protect those most affected by the cost-of-living crisis while operating within tighter budgets.
  - Fiscal authorities should prioritize policies to manage constrained fiscal space.
- Forum focus:
  - Explore better coordination between fiscal and monetary policy from a macro-fiscal perspective.
  - Discuss how to manage fiscal policy under difficult fiscal and inflationary conditions.

### Climate policy — findings and policy recommendations
- Time horizon:
  - Transition to "net zero" greenhouse-gas emissions over the next three decades.
- Policy design elements:
  - Carbon pricing identified as the ideal centerpiece.
  - Carbon pricing may need reinforcing with sectoral measures such as feebates and regulations.
  - Public infrastructure investments and transition measures should be well designed to enhance economic and social resilience.
- Capacity development and analytical tools:
  - IMF Fiscal Affairs Department work includes Climate-Public Investment Management Assessment (C-PIMA), green Public Financial Management (PFM), capacity development on climate mitigation policies, and comprehensive climate fiscal diagnostics.
- Climate finance:
  - Scaling up climate finance requires the right policy incentives to encourage financing flows from both the public and private sectors.
- Forum program note:
  - Climate policy and global cooperation on this topic will be discussed on Day 2.

### IMF support and conclusion
- IMF commitments:
  - Stand ready to help members strengthen public finance through policy advice and institution building.
  - Provide substantive capacity development to help countries address fiscal and climate challenges.
  - Emphasis on listening to member needs and tailoring support.
- Closing remarks:
  - Hope that the forum fosters experience-sharing and development of fiscal policy solutions for member countries.
  - Wishes for a fruitful debate over the next two days and thanks for active participation.

*Source: Opening Remarks at the Eighth Tokyo Fiscal Forum, Mr. Kenji Okamura, Deputy Managing Director, IMF, June 6, 2023.*

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## References

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_Source: https://www.imf.org/en/news/articles/2023/06/06/sp060623-dmd-okamura-eigth-tokyo-fiscal-forum-remarks_