The IMF-World Bank 2022 Annual Meetings

It was a real pleasure to welcome back the Fund’s membership and international community for the first in-person IMF-WBG Annual Meetings in three years.

Despite my joy at seeing people face-to-face, the gathering took place against a darkening outlook. In my curtain raiser speech, delivered in Georgetown University’s magnificent Gaston Hall, I likened our world economy to a ship in choppy waters. We need to steady the ship, but also prepare it to navigate potentially rough seas ahead.

Over the past three years, we have experienced successive shocks: the pandemic, Russia’s invasion of Ukraine, and worsening climate disasters hitting all continents.

During my exchange with the President of the World Bank, David Malpass, I described how these shocks have led to a surge in prices, especially in food and energy, inflicting immeasurable harm on people’s lives.?

I reiterated this downward trend during the launch of the Global Policy Agenda. The IMF has downgraded its growth projections to 3.2 percent for 2022 and 2.9 percent for 2023.?The risks of recession are rising, the threat of financial stability is growing, and uncertainty remains high.

Our latest flagships—the World Economic Outlook, Global Financial Stability Report and Fiscal Monitor—also painted a vivid and worrying picture of the difficult global economic situation.?

The task of dealing with these shocks has been made harder by geopolitical fragmentation. These previously unthinkable blows and the uncertain outlook ahead pose a bigger question: are we experiencing a fundamental shift from a world of relative predictability and stability, to one of greater fragility and volatility?

How then to respond? We must first stabilize the global economy, as I underlined at my Annual Meetings press conference. But even as we address the crises of today, we must cooperate to transform our economy and build resilience against future shocks. I put it like this: we need to act now, we need to act together.

Firstly, policymakers need a steady and determined hand, staying the course on curbing inflation. This will be painful, but the cost of not doing this now will involve greater pain later.

The second priority is to put in place responsible fiscal policies that protect the vulnerable without further fueling inflation and debt worries.

This is why it is imperative that monetary and fiscal policies are coordinated. The absence of coordination would be like monetary policy hitting the brakes while fiscal policy steps on the accelerator—and then we would be in for a rough and dangerous ride.

A third priority is to support emerging market and developing economies which are dealing with the triple blow of a stronger dollar, high borrowing costs and capital outflows.

During my press conference with the chair of the IMFC (International Monetary and Financial Committee), I said that any downturn would be grave for advanced countries but could prove devastating for poorer countries.

Many emerging and low-income countries are facing high debt burdens, with over 60 percent of low-income countries in, or at high risk of debt distress.

During the global debate I said to those countries at risk: “When you see dark clouds on the debt horizon, don't wait. Don’t be shy to recognize reality.” In a more shock-prone world, we all need to adopt a more precautionary mindset. When our members need us, we want them to come early.?

On top of these immediate priorities, we also need transformational reforms to revitalize the global economy and build resilience. This is where stronger international cooperation is critical. As I mentioned earlier, we must act together!

One issue on which we must cooperate is that of food insecurity: a staggering 345 million people are acutely food insecure and hundreds of million more go hungry every day. For our part, the IMF is helping with a new “food shock window” aimed at the countries most affected.

And again, I underlined the need for stronger cooperation to address the existential threat of climate change when I had the privilege of introducing the climate activist Vanessa Nakate.??

To help the transition to greener and more sustainable economies, we have created our first-ever, long-term lending, the Resilience and Sustainability Trust. During the Meetings we thanked the six countries that were the first to contribute and whose generosity enabled us to declare the RST “open for business”!

The in-person meetings also provided an opportunity to reconnect with member countries, including at the 2022 Annual Meetings Plenary. I also held private meetings with many leaders and top officials, among them United Nations Secretary General António Guterres, his Special Advocate for Inclusive Finance for Development, HRH Queen Máxima, and UK climate czar, Alek Sharma.

I also had exchanges with regional groups including from ASEAN, the Middle East and North Africa, and Europe. I spoke to other important stakeholders including at a townhall for members of civil society, to hear what was top of mind for them.

In all, I held close to thirty bilateral meetings and had the pleasure of participating in panel discussions spanning the gamut of climate, financial inclusion, digital currencies, and the global outlook. Together with the World Bank, we also held the Second Ministerial Roundtable Discussion for Support to Ukraine where we were privileged to hear from President Volodymyr Zelenskyy.

The global outlook is difficult, and we must mobilize on issues which cross our borders and viewpoints. But despite the threat of political fragmentation, I see grounds for optimism. Across all the meetings—big and small, regional and global—I was struck by the unity of purpose. It will not be easy, but we now have a clear idea of what is needed to stabilize the world economy and look to the future.

Annual Meetings Updates

Day 1: October 10, 2022 https://www.imf.org/en/News/Seminars/Campaigns/2022/10/annual-meetings-2022-day-1

Day 2: October 11, 2022 https://www.imf.org/en/News/Seminars/Campaigns/2022/10/annual-meetings-2022-day-2

Day 3: October 12, 2022 https://www.imf.org/en/News/Seminars/Campaigns/2022/10/annual-meetings-day-3

Day 4: October 13, 2022 https://www.imf.org/en/News/Seminars/Campaigns/2022/10/annual-meetings-day-4

Day 5: October 14, 2022?https://www.imf.org/en/News/Seminars/Campaigns/2022/10/Annual-Meetings-Day5-2

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