Ministers vow to reignite global economic recovery Spring meetings overview
| Pages | 97-98 |
Page 97
When the world's top financial leaders met in Washington on April 12 for the biannual meeting of the International Monetary and Financial Committee (IMFC)-against a backdrop of economic uncertainty and military conflict in Iraq-they promised to work to boost sluggish world growth, better prevent and resolve financial crises, rebuild Iraq, and reinvigorate the fight against poverty.
IMF Managing Director Horst Köhler told reporters after the meeting, "I am much more optimistic now than I was two or three weeks ago, not only because we can now assume the war will be short, but in particular because of this confirmation that the spirit of cooperation" among the IMF's 184 member countries "is strong and intact" (see IMFC press briefing, page 102). IMFC Chair Gordon Brown, the U.K. Chancellor of the Exchequer, noted that "it is a mark of the commitment of all that even in these challenging and difficult times we have been able to look beyond the here and now in examining all the long-term issues that the world economy faces."
Köhler called on advanced nations in particular to gear their policies vigorously toward growth so that economic recovery can reassert itself in the second half of 2003. The IMF predicts that GDP growth in the major currency areas will remain below potential until the end of the year (see World Economic Outlook, page 118).He also welcomed the ministers' commitment to urgently make concrete progress toward multilateral trade liberalization under the Doha Round, as this will be critical for higher economic growth, poverty reduction, and enabling developing countries to more fully reap the benefits of globalization (see IMFC communiqué, page 99).
On the crisis resolution front, the IMFC welcomed the inclusion of collective action clauses by several countries in international sovereign bond issues, most recently in Mexico, and looked forward to the inclusion of these clauses becoming standard market policy.
It also welcomed recent initiatives to formulate a voluntary code of conduct for debtors and creditors. It said it was not feasible now to move forward on establishing the IMF's proposed sovereign debt restructuring mechanism,Page 98 although it did recommend that work continue on issues raised in its development, notably on intercreditor equity, transparency and disclosure, and aggregation.
The financial leaders of the Group of Seven top industrial...
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