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March 10, 2024

IMF Managing Director Kristalina Georgieva comments after the first meeting of the G20 Finance Ministers and Central Bank Governors in Brazil.



Photo: The Governor, Reserve Bank of India, addresses the G20 Finance Ministers and Central Bank Governors Meeting. Washington DC. April 12, 2023. (File Photo).


Photo: G20 Meeting in Brazil. G20 Social: Presentation of the priorities of the finance track to civil society. February 8, 2024. Image Credit: Audiovisual G20 Brasil.


Photo: G20 Meeting in Brazil. The first meeting of G20 foreign ministers. February 21, 2024. Image Credit: Audiovisual G20 Brasil.

Washington, DC, March 10, 2024 — After the G20 Finance Ministers and Central Bank Governors’ first meeting in Sao Paulo, Brazil, Kristalina Georgieva, the Managing Director of the International Monetary Fund, examined the global economic outlook and highlighted some challenges policymakers face. She also mentioned the IMF’s focus on financial innovations and the importance of sound macroeconomic fundamentals.

Georgieva stated that the global economy’s near-term outlook is improving, which provides an opportunity for G20 policymakers to address medium-term economic challenges. However, there are risks to the downside, such as persistent inflation, financial sector risks, and supply disruptions.

She cautioned policymakers to be careful in 2024 when central banks must decide whether to cut inflation and when government authorities must pursue fiscal consolidation. Georgieva emphasized that structural reforms are necessary for productivity gains, growth improvements, and better living standards. The IMF staff has produced an AI preparedness index for countries that can help inform government efforts to deal with the digital transition.

Georgieva also discussed the IMF’s focus on financial innovations, particularly in three areas:

  1. Central Bank Digital Currencies (CBDCs) can potentially improve the accessibility, stability, and efficiency of domestic and international payments.
  2. Crypto assets require a comprehensive policy and regulatory response to mitigate the risks of criminal misuse. The IMF supports countries in implementing the G20-endorsed roadmap.
  3. Cross-border payments and financial market innovations, including tokenization of assets, are of great interest to the IMF. They aim to make existing payment systems work more efficiently and collaborate closely with the World Bank.

The IMF Managing Director stressed that the organization prioritizes sound macroeconomic fundamentals to promote growth and opportunities while acknowledging the detrimental effects of inequality. The IMF also focuses on strengthening individuals and communities by providing social safety nets, paying attention to labor markets and financial inclusion, and setting a minimum level of social spending to safeguard education and healthcare resources. Furthermore, the IMF recognizes the potential benefits of AI while remaining mindful of its potential risks.

Finally, Georgieva appreciated the focus on financing for development and highlighted the IMF’s collaboration with multilateral development banks to have a more significant impact. She also confirmed the IMF’s commitment to addressing debt vulnerabilities through the Global Sovereign Debt Roundtable.

Source: IMF

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Edited & Posted by the Editor | 7:30 AM | Link to this Post

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