By zainab.joaqué@awokonewspaper.sl
Washington D.C., USA – At the recent International Monetary and Financial Committee (IMFC) press briefing, Chair Mohammed Aljadaan, who is also the Minister of Finance of Saudi Arabia, emphasized the committee’s commitment to supporting low-income countries and addressing pressing global financial challenges.
“We are pleased to announce the completion of the review of the Poverty Reduction and Growth Trust,” Aljadaan stated. “This crucial step ensures that the IMF can continue to assist low-income countries in tackling their balance of payments challenges.”
The Chair urged further action, saying, “We encourage the IMF and the World Bank to enhance their proposal to support countries with sustainable debt that are facing liquidity challenges. This initiative could provide essential relief to vulnerable economies.”
Capacity development was another key topic. Aljadaan noted, “We fully support the IMF’s efforts to strengthen its capacity development assistance and to secure appropriate financing for these vital programs.”
The meeting also marked significant developments in IMF governance and membership. “We are excited to welcome the new 25th chair on the IMF’s Executive Board, representing sub-Saharan Africa,” he announced, highlighting how this addition will enhance the region’s voice in IMF decision-making.
Expanding on the theme of inclusivity, Aljadaan expressed delight at welcoming Liechtenstein as the IMF’s 191st member. “This brings us closer to universal membership, with only one or two potential members remaining.”
Concluding, the Chair reaffirmed the IMFC’s commitment to a strong, quota-based, and adequately resourced IMF at the center of the Global Financial Safety Net.
As the press briefing unfolded in October 2024, IMF Managing Director Kristalina Georgieva shared insights on the global economic landscape and the IMF’s role in addressing ongoing challenges. She highlighted progress in curbing inflation, which has opened the door for potential interest rate reductions to boost growth. However, she cautioned that this progress is tempered by a sense of vigilance among IMF members.
“The conditions of the world economy are good—growth at 3.2 percent, inflation down—but risks are tilted to the downside,” Georgieva noted, emphasizing the need for careful monetary policy and addressing the increasing fragmentation of the global economy.
She outlined three key challenges that dominated discussions during the meetings: the fiscal challenge of balancing budgets after years of active resource deployment without sacrificing growth investments; the necessity of structural reforms to enhance productivity, including labour market reforms and accelerating green and digital transformations; and the importance of building economic resilience in a world increasingly prone to shocks.
Echoing Georgieva’s sentiments, Minister Aljadaan highlighted the IMFC’s role as the IMF’s governing body, explaining that the committee’s purpose is twofold: to foster collective action in support of the global economy and to provide guidance to the IMF’s management.
“The purpose of the IMFC meeting is to exchange views on how we can collectively help the world economy while steering the management of the institution,” Aljadaan stated.
He underscored key objectives, including addressing the final stages of inflation control, finding ways to escape the high debt/low growth trap, and promoting coordinated approaches to boost productivity growth. He also emphasized the importance of member countries finalizing legislative approvals for quota increases to ensure the IMF has adequate resources.
Aljadaan concluded by stressing the need for coordination between IMF management, the IMFC, regional funds, and multilateral development institutions. This collaborative approach, he argued, is vital for tackling the complex challenges facing the global economy in the years ahead.
As the briefing wrapped up, it became clear that while progress has been made, significant challenges remain for the global economy. Under the guidance of the IMFC, the IMF is poised to navigate these turbulent waters, committed to fostering economic stability and growth worldwide. ZIJ/5/11/2024
