‘US working to mitigate risks to global economy’
WASHINGTON (Reuters) — US Treasury Secretary Janet Yellen said Tuesday stronger-thanexpected US economic growth had helped power the global economy, and Washington was working to mitigate remaining risks to the global outlook and ensure sustainable long-term growth.
In remarks prepared for a news conference, Yellen said the US labor market was remarkably healthy and inflation was down significantly from its peak, although there was more work to do.
She said she expected the US economy to continue to underpin the global economy, but acknowledged that the global recovery had been uneven and risks remained.
“From the start of the administration, President (Joe) Biden has made clear that American isolationism was over,” Yellen said. “So while we expect that America’s economic strength will continue to underpin global growth, we’ve also been engaging with the world to mitigate short-term risks and support sustainable long-term growth.”
That work will continue at this week’s spring meetings of the International Monetary Fund and World Bank, where Yellen will meet with officials from China, South Korea, Japan, Britain and many other countries.
Yellen said she raised concerns with Chinese officials during her visit to Guangzhou and Beijing earlier this month about the risks that its manufacturing overcapacity posed to the United States and the global economy.
This week, she said US and Chinese officials will hold the fourth meetings of the Economic and Financial Working Groups, which will focus on anti-money laundering and balanced growth.
Yellen said she also planned to work with Brazil, the current president of the Group of Twenty major economies, including on a review of the global climate finance architecture.
The United States would also keep pushing for reforms at the World Bank and other multilateral development banks to expand their lending capacity to help developing countries deal with climate change, pandemics and other challenges that posed risks to global growth.
“No one country can tackle these issues alone, nor is bilateral action sufficient, so we’ve pushed for decisive and coordinated action,” she said.
Yellen said the World Bank and other MDBs had made significant progress, boosting lending capacity over the next decade by $200 billion from responsibly stretching balance sheets and another $50 billion from capital increases at the European Bank for Reconstruction and Development and the InterAmerican Development Bank.
At the IMF, she said, the United States was focused on strengthening the global lender’s ability to respond to crises and was pushing the IMF to structure loans with “robust policy conditionality” to enable countries to restore stability.