The Atlanta Journal-Constitution
Yellen seeks debt transparency as IMF eyes reserves boost
U.S. Treasury Secretary Janet Yellen called for greater transparency around the use of International Monetary Fund resources and on existing stocks of debt as global finance chiefs consider an expansion in the IMF’S lending firepower.
“Transparent and comprehensive debt data will help promote sustainable growth,” Yellen said
in a letter to her Group of 20 counterparts Thursday ahead of a virtual meeting today of finance ministers and central bankers.
She said that while an expansion in the IMF’S resources could help low-income nations in the fight against the coronavirus, the G-20 and others need to work toward “greater transparency and accountability” in the use of the fund’s firepower.
The IMF is eyeing a $500 billion boost to its reserve assets, called special drawing rights or
SDRS, which the U.S. and others including France and Italy are likely to support, Bloomberg News has reported.
A key concern among private debtholders, along with Republican critics in Congress, has been the scale of China’s loans to developing nations.
The worry is that fresh loans to some countries could end up flowing to pay off obligations to China; such concerns contributed to holding up a bondholder deal with Zambia last November.
Yellen’s letter is “very helpful” and raises an important issue for the G-20, IMF Communications Director Gerry Rice said at a briefing Thursday.
SDR allocations served the world “very well at the time of the global financial crisis, and our view is that it could serve the world well again in this crisis,” he said.
Yellen also made an appeal for multilateral cooperation among the G-20, in a sharp reversal from Trump-era unilateralism that triggered rifts between the U.S. and many allies.
“No one nation alone can declare victory” over the historic health and economic crises stemming from the deadly coronavirus, Yellen wrote in her letter. “Our cooperation has never mattered more. This is a moment made for action and for multilateralism.” Boosting the IMF’S firepower proved a political battle in Washington in the past, and some have declared their opposition this time around as well. Yellen’s predecessor, Steven Mnuchin, opposed the move, saying that because reserves are allocated to all 190 members of the IMF in proportion to their quota, some 70% would go to the G-20, with just 3% for the poorest developing nations.
Under Senate Bill 102, Georgia’s local governments would be prohibited from adopting building codes and other controls restricting energy sources. The bill also bans similar limitations by state agencies.
Some Georgia communities have formally adopted resolutions to address crucial global overheating threats through the decisive reduction of heat-trapping greenhouse-gas emissions — which are the primary cause of rising temperatures and their increasingly dire consequences worldwide.
A key element of these resolutions is the rapid replacement of power generated using polluting, carbon-based fuels with clean-energy sources. This emerging clean-energy transformation is already generating enormous business and job opportunities.
Instead of protecting privileged corporate fossil-fuel interests, as SB 102 does, Georgia should adopt legislation that provides support for diverse local job creation in clean energy, overdue infrastructure improvements and other critical priorities.
Choices offering the greatest promise to Georgia’s communities and energy consumers are thwarted by SB 102, not protected by it.
Defeating the bill is essential if Georgia’s leadership hopes to prevent misguided commitment to obsolete practices that jeopardize our future.
The state’s economy will surge this spring as more people are vaccinated against COVID-19, though a sustained recovery won’t come until next year, according to a report Thursday from the Georgia State Economic Forecasting Center.
The pace of growth this quarter, which ends March 31, will be a solid 3.2%, said center director Rajeev Dhawan. But, from April through June, the economy will expand to a robust 8% — faster than any pre-pandemic growth,
That will be partly due to months of constrained behavior, Dhawan said at the center’s quarterly conference. “As people are more comfortable that there’s an end in sight, people will spend.”
The second half of this year will see continued growth at a
more moderate rate, he said. “Reaching a sustained recovery by early 2022 is contingent on the speed and efficacy of vaccinations.”
Dhawan predicted the state will add 68,900 jobs this year, followed by growth of 100,000 jobs next year. More than 75% will be in metro Atlanta.
Strong as the recovery will be, some parts of the Georgia economy will continue to struggle, he said.
Many people still might be slow to return to restaurants or other businesses that rely on in-person interaction. “You can open it up. But, if nobody comes, nobody comes,” he said.
While hope may be on the horizon, the state’s economy right now is still spinning its wheels.
Last week, 25,447 new jobless claims were processed, only slightly fewer than the previous week, the state Department of Labor said. Food and accommodation workers continued to account for the largest share of layoffs.
Though there are many uncertainties, vaccines — along with a large spending package expected from Congress — offer reason for higher expectations, said Abbey Omodunbi, senior economist for the PNC Financial Services Group.
Still, it will take time to recoup the unprecedented losses caused by the pandemic, he said. “We do not
expect employment to return to its pre-pandemic level for a couple of years.”
One concern is inflation, said James Bullard, president of the Federal Reserve Bank of St. Louis, who also spoke at the GSU center’s conference.
That’s because Congress and the Federal Reserve have acted in ways that could stimulate — and potentially overheat — the economy. The Fed has kept short-term interest rates low, while Congress has already committed to spending more than $3 trillion — with more on the way.
Inflation has been low for decades despite frequent warnings by some economists that price spikes were just around the corner. The pandemic crisis has convinced policymakers to be cautious about acting to crush inflation by raising interest rates, Bullard said.
Moreover, much of the spending in the federal relief packages during the pandemic has been aimed at “keeping households whole,” not stimulating economic activity in a way that would spark inflation, he said.
“We’ve been telling workers to stay home as an investment in national health,” he said. “I call this fiscal relief, not fiscal stimulus.”