IMF board of governors predicts strong global economy 

THE Committee of the Board of Governors of the International Monetary Fund (IMF) said that it would take necessary actions to strengthen the recovery of the global economy. The Chairman of the committee,  Mr. Thaman Shanmugaratnam, made this known at the weekend, in Washington, at the on-going annual spring meeting of the IMF and World Bank. He said that the global recovery was gaining strength, but remained vulnerable.We discussed the significant risks to the outlook and decided to take necessary action to strengthen the recovery. Credible action are needed to accelerate progress in addressing challenges to financial stability and sovereign debt sustainability, she said.According to him, to ensure timely fiscal consolidation in advanced economies, the committee underscored the importance of employment creation for medium term sustainability. He added that the immediate economic impact of the tragic events in Japan and some of the developments in Middle East and North Africa also warranted close attention. As policies can have significant cross border effect, we will continue to work together to address policy spill over and to secure robust and balanced global growth, he said. Shanmugaratnam said that the committee was committed to accelerated efforts to strengthen resilience of the financial sector to support economic recovery.He also added that progress was needed to address excessive financial risk and strengthen financial regulation in financial centres. Recent international agreements on enhancing financial regulation must now be implemented and accompanied by more effective supervision, he added.On low-income countries, the chairman said that the IMF should continue to provide policy support and financing to help overcome their balance of payment problems. He said that the committee had urged IMF to refine its tools to assess low-income countries vulnerabilities and debt sustainability and explore avenues to help their better management volatility.
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