Fiscal Consolidation: Striking the Right Balance

The debate on austerity vs. growth has gained in intensity, as countries in Europe and elsewhere struggle with low growth, high debt, and rising unemployment. In essence, policymakers are being asked to tackle a continuation of the worst crisis since the Great Depression. This would be no easy task under any circumstances. But it is made considerably harder by the fact that a number of countries need to engage in fiscal consolidation simultaneously. Complicating the picture further is the fact that monetary policy in most advanced economies is approaching the limits of what it technically can do to stimulate activity, while global growth remains weak.

How to Get the Balance Right: Fiscal Policy At a Time of Crisis

The crisis has harmed growth, increased unemployment, and left a large number of people less protected. We are now seeing some signs of stabilization. Most countries are reducing their deficits and even if debt ratios are still rising, the return back to fiscal health has begun.

Lagarde on Women in Leadership

International Monetary Fund Managing Director Christine Lagarde spoke to historian Niall Ferguson about the role of women in leadership around the world, saying it might be a safer place if more women were in charge.

Lagarde: “World Economy Not Out of Danger Zone”

“Derailment of the global recovery, which was a clear and distinct danger a few months ago, has been avoided for now thanks to strong policy measures–in particular those of the European Central Bank–and strengthened governance in the euro area, and reforms and adjustment in countries such as Italy, Spain, and Greece,” Lagarde said. “High frequency indicators also now suggest an uptick in activity, mostly in the United States.”

IMF Welcomes New Eurozone Understanding on Greece

“The combination of ambitious and broad policy efforts by Greece , and substantial and long-term financial contributions by the official and private sectors, will create the space needed to secure improvements in debt sustainability and competitiveness,” Lagarde said in a statement. “These actions, together with a significant strengthening of the financial sector, will pave the way for a gradual resumption of economic growth.”

Saudi Arabia: a Key Regional and Global Player

I leave the Middle East and North Africa region with a sense of hope and resolve to return to the region again soon.

I believe that with determination, the goals of the Arab reform agenda are within reach. Putting such reforms in place will help countries in the region both meet people’s aspirations and help them contribute even more to the rest of the world.

Hope and Perseverance on Tunisia’s Demanding Road Ahead

Tunisia is going through an inclusive process of transition, but faces some extraordinary challenges. I have heard from its leaders how Tunisia was the model that paved the way for the Arab Spring, and their firm belief that it remains capable of lighting the path forward for other countries going through historic changes in the region.

Lagarde in Davos: How to Avoid an Economic Deep Freeze

Amid the heaviest snowfall in Davos for decades, IMF chief Christine Lagarde has been making her case for urgent action to resolve the eurozone crisis, which is at the center of current global economic concerns. The Fund recently sharply revised downward its forecast for global economic growth and in a speech in Berlin Lagarde mapped a way forward.

Driving the Global Economy with the Brakes On

The world recovery, which was weak in the first place, is in danger of stalling. The epicenter of the danger is Europe, but the rest of the world is increasingly affected.

Showcasing a More Confident Africa

Africa is on the move. While several other regions of the world have to address slowdown and uncertainty, many countries in Africa have been facing a contrasting challenge: to respond to the growing demand for their bountiful resources and manage rising investment in much-needed infrastructure. But at the same time, growing economic uncertainty in the world is raising concerns across the continent where vulnerability to global shocks remains high.

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