IMF calls on countries to carry out structural reforms and to strengthen resilience to future economic shocks

Representatives of the IMF and the World Bank gathered at their annual meetings, this year held in Indonesia. Alongside representatives of the finance ministry, the Slovenian delegation included Primož Dolenc, the deputy-governor of the Bank of Slovenia, and Irena Vodopivec Jean, a vice-governor.

The IMF is continuing to forecast moderate growth for the global economy (3.7%), while growth in the euro area is expected to reach 2% this year, and 1.9% next year. In light of the probable deterioration in the economic outlook, the IMF again called on countries to take advantage of economic indicators that remain good for the moment to carry out the necessary reforms and to strengthen the resilience of the economic and financial system to future shocks and the anticipated changes in the cycle. It sees the key as carrying out the necessary reforms to make a positive contribution to fiscal consolidation and economic growth.

At the same time there is a need for measures to ensure the stability of the financial system, as any imbalances in the financial system could be reflected very rapidly in the real economy. In the years after the global financial crisis, and in conjunction with other economic policies, an accommodative monetary policy succeeded in driving economic growth in various countries to its current high levels, but in the upcoming period monetary policy will gradually normalise in the majority of economic regions.

The main risks to the global economy highlighted by the IMF were the rise in protectionism and barriers to international trade, the imminence of Brexit, and geopolitical tensions.

At the meetings the Slovenian delegation joined the calls for open international trade, and for the resolution of disputes within the framework of a rules-based system, as this is of vital importance to Slovenia, as a small, export-oriented economy.