Ministers see improved global economy, vow to resolve financial crises and fight poverty

• Author: Laura Wallace
• Position: Editor, IMF Survey
• Pages: 113-114

Page 113

When the world's top financial leaders met on April 20 for the biannual meeting of the International Monetary and Financial Committee (IMFC), they welcomed the markedly improved global economic picture and agreed to take steps to prevent and more quickly resolve financial crises, reinvigorate the fight against poverty, and combat money laundering and the financing of terrorism.

IMFC Chair Gordon Brown, the U.K. Chancellor of the Exchequer, told reporters that it was "a successful meeting" that not only moved the reform process forward and underscored the results of enhanced global cooperation but also "laid the steps for us to go further and faster to meet the Millennium Development Goals while tackling the problem of terrorist finance" (see IMFC press briefing, page 123). He noted that the fears of a global recession- evident when the ministers met last November in Ottawa-had not been realized, "thanks to decisive action by policymakers around the world and the strengthening of international cooperation."

He said that the challenge now is for governments to help foster the global recovery that is under way (see World Economic Outlook, page 140).

Combating financial crises

One of the main items on the agenda was beefing up crisis prevention and resolution. Brown said that the IMFC agreed on a number of ways that the IMF could do a better job of surveillance, including more comprehensive and candid assessments.

The key, he said, was that all now agreed that "individual proposals in this area of reform cannot be taken in isolation, that we are talking about a wider package of reform to create an international financial system in the twenty-first century that recognizes the new realities of open, not sheltered, economies; international, not national, capital markets; and global, not local, competition."

This echoed remarks made by IMF Managing Director Horst Köhler in a National Press Club speech on April 17, that "if we do not manage a better balance between the opening of capital accounts and the expansion of trade, we may see a cyclical recurrence of financial crises. This means that better trade opportunitiesPage 114 for all and the expansion of trade must now become the centerpiece for a strategy to promote sustained global growth and truly shared prosperity."He called on the advanced countries to open up their markets and phase out the...