Facilitating Global Cooperation Key Priority for IMF

Enabling and underpinning global cooperation key concern for IMF

Work on capital flows, reserve currencies, reserve accumulation, to be stepped up

Global financial safety net and helping low-income countries both also priorities

IMF Survey online: What will be the priorities for the IMF’s work in the coming months?

Moghadam: The multispeed recovery—surging here, limping there, in the doldrums elsewhere—is testing policymakers, pulling them in different directions and creating new challenges as financial flows shift rapidly across the globe. The IMF’s work program for the next six months attempts to come to grips with these policy challenges, as well as some longer term ones exposed by the crisis.

At the same time, the recent intensification of pressures in Europe reminds us that our ongoing efforts to advise on, and provide financing for, stabilization programs will remain a prominent part of the IMF’s work, even if it is not a part of the formal “work program.”

Beyond the immediate task of supporting financial stabilization in member countries, our work in the coming months will focus on:

•Promoting balanced and sustainable growth (which includes work on risks, fiscal adjustment, and policy coordination)

•Strengthening the international monetary and financial system (which includes work on responses to capital flows, reserve accumulation, surveillance, and the global financial safety net)

•Building a stronger financial architecture (which includes work on macro-prudential surveillance and data gaps).

•Delivering higher growth and stability in low-income countries (which includes new work on growth drivers and an extension of the vulnerability exercise to low-income countries).

I should also note that all of the above proceeds against the backdrop of a series of landmark reforms over the last two years, in particular to strengthen our lending toolkit for emerging markets and low-income countries, and more recently, to modernize the way the IMF makes decisions.

IMF Survey online: What is the IMF’s role in helping to defuse current tension on issues ranging from exchange rates to trade?

Moghadam: The IMF was established for precisely this purpose, to avoid resort to policy options that seem to be in the domestic interest but are collectively destructive, and to use the Fund as a forum to promote cooperative solutions. There is a sense in many quarters that the spirit of global cooperation evident during the crisis is flagging under the strain of uneven and different pressures in different parts of the world. What can...