Barbados on the global scale
We were proud to see our Prime Minister, the Honourable Mia Mottley, participating in a Debate on the Global Economy, as part of the 2022 IMF Spring Meetings.
The Prime Minister joined the debate remotely, and other panellists were Christine Lagarde,President of the European Central Bank, Sri Mulyani Indrawati Minister of Finance for Indonesia, Jerome H. Powell, Chair of the Board of Governors of the Federal Reserve System in the United States. It was moderated by Sara Eisen, news anchor for CNBC’.
The war in Ukraine was the main topic of conversation and the panellists discussed the repercussions for the rest of the world.
Here's a summary of the discussion (from the IMF):
- Multiple headwinds. Panelists stressed that the world is grappling with multiple shocks including the war in Ukraine, high inflation, food and energy insecurity, high debt levels, and climate change. Georgieva noted that the IMF’s further possible downward revision of the global growth forecast depends on the war’s duration and the effectiveness of policies to deal with inflation without slowing down economic growth. Lagarde noted that the war has not only led to devastation and a refugee crisis in Europe but has also caused ripple effects globally. With U.S. inflation beyond the Federal Reserve’s 2-percent target, Powell emphasized the need to establish price stability and noted that it is appropriate to move a little more quickly to remove monetary accommodation. Indrawati noted that the U.S. monetary policy tightening and COVID lockdowns in a few Chinese cities will exert a huge impact on many emerging markets and developing countries, adding pressure on their nascent recovery from the pandemic. Noting that its debt vulnerabilities have risen since the onset of the pandemic, Mottley highlighted that Barbados does not have the same fiscal and monetary policy accommodation cushion as the advanced economies.
- Globalization. Powell noted that it is unclear if the world is witnessing a reversal of globalization, but the pace of globalization is certainly slowing down. Georgieva argued that it is too early to “buy a coffin” for globalization. The world has achieved so much because of the integrated global economy, and it is irresponsible to make the world poorer.
- International coordination. Panelists concurred that international cooperation at this juncture is more critical than ever. One of the objectives of the IMF and World Bank Spring Meetings, highlighted Georgieva, is to provide a platform for policymakers to deliberate and identify the optimal policy mix to address short-term challenges without jeopardizing long-term sustainable growth. The newly-established Resilience and Sustainability Trust will provide long-term concessional financing for many low- and middle-income countries. Mottley called for non-Paris Club creditors and the private sector to further contribute to resolving countries’ debt vulnerabilities. Indrawati stressed that preserving global cooperation is one of the most important global assets.