At a news conference to open the Annual Meetings of the World Bank Group and International Monetary Fund, IMF Managing Director Kristalina Georgieva on Thursday urged world leaders to work together to counter a “synchronized slowdown” in the world economy.
“The global economy is now in a synchronized slowdown. Fractures, driven by trade, driven by uncertainties surrounding geopolitical tensions and Brexit, they’re holding back growth. And, they are causing hazards in this shared road we are traveling on. They are slowing us down,” Georgieva said at the news conference.
Georgieva said if trade tensions between the U.S. and China continue with no relief on tariffs, forecasts call for a cost to global growth of 0.8 percent. But, she welcomed news of a possible easing of trade tensions.
“This truce discussed could very well reduce the loss by 0.2 percent. And that, of course, is good news. But, not good enough. What we need is to reach not just truce, we need to have trade peace. We need to go back to, well, no, we need to go forward to a system that is enhanced and it is enforced. So, we can see trade to return to its role of an engine of the word economy,” she said.
Georgieva also praised Thursday’s news of a Brexit deal.
“This is good news. This is, of course, welcome. Very similar to the pound, which jumped, I saw the news and jumped. Great. We would like to see the agreement being reached. If I could quote my former boss Jean-Claude Juncker, he said, ‘When there is a will, there is a deal.’ My hope for the next days is that the will holds in all quarters.”
And Georgieva said the IMF will stand with Argentina as it works through its economic crisis.
“We, at the IMF, are fully committed to work with Argentina and to make sure that there can be policy improvements that lead ultimately to better lives for people in Argentina. We are very closely engaged and following all the developments in the country. And, I can assure you that this will of the IMF to stand by Argentina was strong when Christine Lagarde led the Fund. And, it is strong now when I take over.”