Africa: Opening Remarks for Spring Meetings Press Conference


As prepared for delivery

1. Introduction

Welcome to the 2019 Spring Meetings!

I would like to start by welcoming David Malpass who has just held his first Spring Meetings press conference as President of the World Bank-congratulations to him on his new role!

Before turning to the global outlook, on behalf of the IMF, I would like to express my heartfelt condolences and our commitment to the people of Mozambique, Zimbabwe and Malawi, where just a few weeks ago Cyclone Idai caused extensive damage and a tragic loss of life.

I can tell you that the government of Mozambique has submitted a request for a Rapid Credit Facility, which provides speedy access to concessional financing from the Fund-and we will be moving that forward as fast as we can.

I am also very pleased to tell you that yesterday our staff mission team announced that they had reached agreement with the Zimbabwean government on a new Staff-Monitored Program-which will help them address deep economic problems and provide an important stepping stone to a more stable future.

2. Outlook

Another issue on our minds today, of course, is the changing global economic landscape. Indeed, I am reminded of a line from Mark Twain:

"In the spring, I have counted 136 different kinds of weather inside of 24 hours."

This uncertainty is true in nature, and it is also true currently in the global economy. Just a year ago, we saw a synchronized upswing; today we are looking at a synchronized downswing.

As per the WEO numbers, we are projecting a slowdown in global growth to 3.3 percent in 2019. That level of growth remains reasonable-and we do not see a recession. We are projecting a return to higher growth in 2020-at 3.6 percent.

But we are at a "delicate moment". This expected rebound is "precarious" and subject to downside risks : from trade tensions, high debt in some sectors and countries, the risk of weaker-than-expected growth in some stressed economies. And Brexit.

3. Policy Recommendations

What can be done to mitigate these risks and support the rebound? In my Global Policy Agenda, which we are releasing today, we outline our policy recommendations. We need to be country-specific, of course, no one size fits all.

But let me highlight two broad categories of priorities:

First, Do no Harm.

The key is to avoid the wrong policy actions. This is especially the case for trade.

We know that, for many decades, trade integration has helped to boost growth, reduce poverty, and lift productivity and employment around the world. At the same time, we know that this engine of prosperity needs to be fixed.

We need to better address dislocations caused by trade and technological innovation, and do more to support those left behind. We need to better address unfair trade practices and distortions in the system, including through WTO reform.

And we need to avoid self-inflicted wounds, including tariffs and other trade barriers.

Second, Do the Right Thing.

While avoiding missteps, policymakers also need to take the right policy actions to address country-specific needs:

"Fix the roof" with structural reforms, especially in product and labor markets. This will help boost potential output to prevent disappointing long-term growth in advanced economies, and help developing countries to catch up with their wealthier peers.

Create more room to act when the next downturn comes -enhance resilience by making smarter use of fiscal policy and by strengthening financial sector policy, including maintaining the momentum of regulatory reform.

Tackle issues which have high potential to boost not only revenue but also growth and inclusion. Such issues include reforming international corporate taxation, strengthening competition frameworks, and-above all-fighting corruption.

In all these efforts, we need stronger international cooperation.

By working together, countries can address what Shakespeare called the "uncertain glory of an April day". We need that spirit of cooperation to turn uncertainty into action, not just this Spring but in the months and years to come.

With that, I am happy to take your questions.

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