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Roundup: IMF, World Bank Pledge to Avert Recession
The Spring meetings of the International Monetary Fund (IMF) and the World Bank concluded Monday in Washington with pledges to keep the sputtering global economy from toppling into a recession.
Finance ministers and central bank officials from over 180 IMF-World Bank members participated in the two-day meetings, which were held against a backdrop of weakening worldwide economic momentum, notably in the United States, Japan and Europe, that according to the IMF will have a punishing effect on the poorer nations.
The Development Committee, the policy-setting group of the World Bank, stressed in a communique issued Monday the World Bank' s important role in supporting middle-income countries' economic growth and poverty reduction efforts.
The communique said world finance ministers noted that combating poverty in middle-income countries was essential for meeting the International Development Goals, and emphasized the importance of a menu of lending instruments, reflecting borrowers' different needs, objectives, and track records and Bank Group comparative advantages.
They urged the World Bank to translate its proposals into specific actions for strengthening the Bank Group's analytic and financial support for middle-income countries.
On global trade, the ministers said the World Bank, in collaboration with its partners, can play an important role in helping developing countries to increase their ability to access global markets.
Another communique issued Sunday by the International Monetary and Financial Committee, the policy-making body of the IMF, said the agency will fight the current global economic slowdown and take measures to meet common objective of open trade for greater global prosperity.
The committee is unanimous in its view that recourse to protectionism would be the wrong response to the global economic slowdown and the attendant difficulties in particular sectors.
Therefore, the panel called on all developed and developing countries to find a common ground for the launch of new multilateral trade negotiations this year.
The IMF also promised to set up better procedures to prevent a repeat of the Asian currency crisis in 1997-1998, which plunged two-fifths of the world into recession.
Prior to the IMF-World Bank meetings, ministers of the Intergovernmental Group of Twenty-Four (G-24) on International Monetary Affairs held the 65th meeting. The participants complained the current trade policy stance of industrial nations constitutes a major barrier to their growth prospects.
The ministers said in a communique that many developing countries, particularly the low-income countries, are yet to benefit from this trade expansion, as a result of protectionist mechanisms. They called on developed countries to reduce trade barriers and open markets to low-income nations.
The G-24 consists of an important cross section of countries across Africa, Asia and Latin America. Since its establishment in 1972, the G-24 has become the primary institutional mechanism for the coordination of developing country positions on monetary affairs.
Meanwhile, finance officials from the seven industrialized countries also held a meeting here, promising to pursue appropriate policies in each of their countries that will lead to stronger economic growth.
In a joint statement issued following the meeting, the finance ministers and central bankers from the Group of Seven countries -- the United States, Japan, Germany, France, Britain, Italy and Canada -- said they will remain vigilant and forward-looking in their efforts to fight the current global slowdown.
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