‘Reform while global economy is strong’

WASHINGTON: Finance chiefs from around the world were warned on Thursday to get their houses in order while the global economy is strong and to be ready for possible shocks in the future.

World Bank President Jim Yong Kim and International Monetary Fund managing director Christine Lagarde said countries must address their mounting debts and deepening inequalities now.

That includes reducing sovereign borrowing and dependence on often fickle flows of portfolio capital that have elevated the prices of investment assets like stocks and property.

“After several years of disappointing growth, the global economy has begun to accelerate,” said Kim at the opening of the annual IMF-World Bank meetings, here.

“Trade is picking up, but investment remains weak. We’re concerned that risks such as a rise in protectionism, policy uncertainty, or financial market turbulence could derail recovery.

Lagarde said even though the IMF had just raised its estimates for global economic growth — to a healthy 3.6 per cent this year and 3.7 per cent next year – “it is not time to be complacent”.

“It is time to take those policy decisions that will actually enable more people and more countries to benefit from that recovery that should be made sustainable,” she said. AFP

Trade is picking up, but investment remains weak.

JIM YONG KIM

World Bank president