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Managing Director of the International Monetary Fund (IMF), Christine Lagarde has cautioned that policy makers all over the world must use economic reforms to deal with the problems created by political tension in their climes.
Lagarde argued that the best weapon to push through economic reforms is for policy makers to deploy the best of economic performance that will tend to defuse political tension.
Lagarde spoke as as finance ministers and central bankers from the IMF’s 189 member nations meet this week in the U.S. capital for the fund’s annual meetings.
The IMF is pushing reforms that include investment in education, a strengthening of safety nets and infrastructure spending.
She lauded the growth in some countries economy and cautioned it must follow reforms to sustain.
Lagarde said. “It is not time to be complacent it is time to take those policy decisions that will enable more people and more countries benefit form the recovery.”
“Our goal is turning that harmony we see into a season of action,” Lagarde told reporters Thursday in Washington, adding : “The recovery is not complete.”Threats include the risk of volatile capital markets and tighter financial conditions with spillover consequences around the world. Disruption from new technology is also on the worry list, and Lagarde again urged for a resistance towards protectionism that could disrupt a trade revival.
“This pickup in trade that we see is good for growth and we need to secure it and make sure it continues to be so,” Lagarde said. “Trying to reduce trade would not be helpful for that roof we want to fix.”