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Handle the Economies with Care, Spring Meetings 2019, Washington DC

The Managing Director of IMF Christine Lagarde said that the “economies need to be handled with care.”

Last year she had said to the Finance Ministers that “it is when the sun is shining you have to fix the roof” borrowing the sentence from the President John F. Kennedy. 

In January, in Davos, the Managing Director had announced a further downward revision of the forecast. The world economy is growing more slowly than expected and risks are rising. At that time the goal was declared to make economies more resilient and more inclusive as well as the need to increasing collaboration were mentioned.

From January to April there appears no sunshine in the economy.

Now, only 70% of the global economy is expected to experience a slowdown in growth, while no recession is expected. While the 2019 Q4 may even bring better news, however it is now a delicate moment for the global economy.

It was described as “right now the whether is increasingly unsettled and growth is precarious.”

High debt in some sectors and in some countries, particularly in those who borrowed in non domestic currencies present a risk that needs to be handled with care. The economies are vulnerable to downside risks many due to the unease in financial markets and the economies have been slowing down mainly rising tension in trade policies. 

Also, in the Communiqué of the Thirty-Ninth Meeting of the IMFC it is mentioned that among the risks that need to be cited are trade tensions, policy uncertainties, historically high debt levels, and heightened financial vulnerabilities. 

In the communique it was also clearly stated the IFC supports increasing gender diversity in the Executive Board.

What else can I say?

Going back to the situation right now:  This delicate moment requires avoiding policy missteps and making sure that countries adopt right policies. That is, economy needs to be handled with care.

I am hoping that we can handle the delicate economy with care in Turkey as well!

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