WASHINGTON: In annual financial moot of the International Monetary Fund (IMF) and the World Bank heree the World finance leaders have defended globalisation against the policies of U.S. President Donald Trump and European populists.
They argued that blocking free trade would hobble economic growth instead of saving jobs from foreign competition. World Bank President Jim Yong Kim told media-persons that free trade and more openness were “critical for the future of the world.”
Christine Lagarde, the managing director of the International Monetary Fund, said that the answer to the wave of populism gaining support in many countries was to work for “more growth and better growth” in the world economy.
Lagarde and Kim spoke at the opening of three days of discussions among global finance leaders representing the 189 countries that are members of the IMF and its sister lending organisation, the World Bank.
Pakistan has been represented in the moot by a delegation headed by Minister of Finance Ishaq Dar.
The meetings will also include discussions among finance ministers and central bank leaders from the Group of 20 major economic powers, which will likely to be dominated by talk over the Trump administration’s efforts to reduce America’s huge trade deficits, which Trump during the presidential campaign blamed for the loss of millions of factory jobs. The United States will be represented at the meetings by Treasury Secretary Steven Mnuchin and Federal Reserve Chair Janet Yellen.
Trump tapped into a rising backlash against free trade during the presidential campaign, pledging that he would impose punitive tariffs of up to 45 per cent on countries such as China and Mexico which he blamed for pursuing unfair trade practises that were hurting American workers.
The anti-globalisation backlash has also shown up in Europe, playing a factor in last summer’s vote in Britain to exit the European Union, and also in the election campaigns in other countries including this Sunday’s vote for president in France.
Lagarde said that the IMF and its member nations needed to “protect free, fair and global trade.” In an interview with CNBC, Lagarde said that the goal of all nations should be to promote a level playing field in trade.
In his World Bank news conference, Kim said a recent study showed that of all the job losses that have hit industrial countries in recent years, at most only 20 per cent could be blamed on increased trade competition. He said the biggest factor in the job losses was increased automation.
“My message is you’re not going to bring these old jobs back,” Kim said. “Every country in the world has to think about how it’s going to compete in the economy of the future.”