Ministers press for progress on global trade talks

• Pages: 99-102

Page 99

Following is the full text of the communiqué of the International Monetary and Financial Committee (IMFC) of the Board of Governors of the IMF, which met in Washington, D.C., on April 12, and was chaired by Gordon Brown, U.K. Chancellor of the Exchequer.

Meeting at a time of economic uncertainty, the committee reaffirms its commitment to close international cooperation to strengthen confidence and support the global recovery. It underscores the importance of continued vigilance. But with readiness to adjust policies as necessary and determined further action on the structural front, the world economy has the prospect of strengthening growth and renewed prosperity. Substantial and concrete progress with multilateral trade liberalization is a key priority for the coming months and has the full political commitment of ministers.

In the advanced economies, sound fundamentals and policies should deliver stronger growth in the second half of the year.With inflationary pressures well contained, monetary policies should remain accommodative, and in many countries there is room to ease monetary policy further if needed. On the fiscal side, the automatic stabilizers should be generally allowed to operate, though in many countries action is needed to address medium-term fiscal pressures, including those arising from aging populations.

The advanced economies have a shared responsibility to go further in implementing structural reforms- to enhance prospects for a sustained broad-based world recovery that helps correct global imbalances.

In the United States, policies consistent with a sound medium-term fiscal position remain important. In Europe, labor and product market reforms need to be accelerated. In Japan, further steps are needed to strengthen the banking and corporate sectors and end deflation, accompanied by a start toward strengthening the medium-term fiscal position.

Emerging market countries will need to continue to strengthen their policies for macroeconomic stability and structural reforms and therefore their resilience to adverse global developments. In countries facing external financing constraints, efforts to sustain macroeconomic stability will continue to be key to restoring confidence. For all countries, the continued implementation of reforms to strengthen banking and corporate sectors and underpin growth remains a priority. The IMF has a key role to play in supporting these efforts.

Prospects for stronger growth in low-income countries should be supported by improved economic policies, stronger institutions, progress in resolving regional conflicts, and increased donor resources, including through debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative. Sustained implementation of sound policies, supported by strong ownership and the Monterrey Consensus, will remain key to reducing poverty and meeting the Millennium Development Goals.

African countries need to continue to press ahead with the wide-ranging reforms embedded in the New Partnership for Africa's Development-in particular to improve the quality of their institutions and ensure peace and security. The committee reiterates the importance of technical assistance, including the contribution of AFRITACs and other regional technical assistance centers. It calls on the international community to urgently mobilize additional assistance to address the serious food shortage in Africa.

The committee notes that the present situation in Iraq poses significant challenges, with an urgent need to restore...