IMF Lagarde
Ms Lagarde Director of the IMF commented after the summit of G20 finance ministers in Mexico City refused to hand over any more cash to the IMF until Europe does more to combat a crisis that still threatens to torpedo the global economic recovery.
There had been hopes that the first summit of finance ministers this year would see an agreement from the rest of the world to help Europe tame its crisis. European finance ministers were instead told that they must bolster their own financial firewall first and not until after would the question of more funding for the IMF be discussed putting it off until finance ministers next meet in April in Washington.
Ms Lagarde, who was the French finance minister until she took the position at the IMF last summer, said she would like to see an accord as soon as possible but admitted that putting an exact timetable on the process was hard.
Despite the improvement of the indicators of global economic activity, the risks are latent and the world economy is still in the “danger zone”, she continued
At the conclusion of the G-20 Summit, , Lagarde said in a press conference that the reasons to stay alert is the situation of “fragility of the financial sector” in the euro area, the “high level of public debt in most advanced economies” and “High oil prices”.
“The growth is still weak in advanced economies is moderating in some emerging markets, and at the same time, unemployment is still too in many economies, especially in advanced economies,” said Lagarde yesterday.
The director of the IMF welcomed the outcome of yesterday’s meeting of the 20 strongest economies in the world because it is “a step in the direction” of a sequence of actions to Europe to increase their “firewall” and then wait for contributions from the IMF.
The G20 agreed on Sunday in a statement it will wait for the euro area to enhance its “firewall” before providing more resources for the IMF, an issue to be discussed in April.
The fund is trying to raise U.S. $ 500 million to cope with the crisis of sovereign debt in the euro area and its possible implications for other regions.
Lagarde said the U.S. $ 500 million is not an obsession, but the result of a thorough and detailed analysis of the global economy.
Originally posted here
