IMF Chief Urges Action to Deliver on G20's Hangzhou Commitments

The head of the International Monetary Fund (IMF) has stressed the need for the Group of 20 nations to proceed with structural reforms to help boost the world economy.

    Speaking at a press conference after the last session of the G20 summit, Lagarde congratulated China for its leadership of the G20 this year and its excellent organization of the leaders' meeting in the scenic eastern Chinese city of Hangzhou. "A first priority is a coordinated effort to raise growth. The G20 agreed that this will require making full use of all policy levers--monetary, fiscal, and structural--individually and collectively, Lagarde said. 

    The G20 also agreed to identify and prioritize reforms that provide the biggest growth impulse for each country, which is an area where the IMF is actively engaged. Pushing back against protectionism and pushing forward with free and fair trade is a vital component of this growth agenda.

    "A second priority is a commitment that growth must be more widely shared. Again, countries should deploy proven tools to reduce excessive inequality and raise economic prospects, particularly for low-income groups and workers affected by rapid technological change--for example, through skills training and investments in education and health. We need increased growth, but it must be better balanced, more sustainable, and inclusive so as to benefit all people, she added.

    "The G20 endorsed several initiatives underway to support the stability and resilience of the international financial architecture. This included support for further strengthening of the global financial safety net, with an adequately financed IMF at its center and equipped with a more effective toolkit. This would also involve even greater cooperation between the IMF and regional financing arrangements, such as the Chiang Mai Initiative.

    "G20 leaders welcomed the entry-into-effect of the IMF's 14th review of quota reforms--which represent a major step toward reflecting the increasing role of dynamic emerging market countries in the Fund's governance--and working towards completion of the 15th review by the 2017 Annual Meetings. The G20 also welcomed the inclusion of the Renminbi into the SDR (Special Drawing Right) currency basket as of October 1st--an important milestone that will help strengthen the international monetary system as well as China's role in the global economy. More generally, the G20 supported the ongoing exploration of broader use of the SDR.