The Deputy Managing Director of the International Monetary Fund (IMF), Antoinette Sayeh has urged countries to build strong institutions to promote a smart recovery from the COVID-19 pandemic.
She stated that as countries move to recovery, building strong institutions and enhancing capacity should remain paramount to enhance the recovery process.
She made these remarks whilst speaking at a Joint Vienna Institute (JVI) Virtual Annual Lecture on November 10.
“…at the current juncture, as we chart policies to help us climb back out of the depths of this crisis, we have a once-in-a-century opportunity to build forward better. It is more than a historic opportunity; it is an imperative—a prerequisite to making our economies smarter, greener, and more inclusive”.
According to her, the focus should shift to policies that are necessary to boost growth while maintaining macroeconomic stability. She admitted that the crisis also offers an opportunity to build forward better by tackling cross-cutting challenges such as inequality and climate change while leveraging digitalization.
The crisis, according to Sayeh, has without question put a great demand on fiscal resources; and many countries confront rapidly rising debt levels and declining fiscal space.
“Yet, generating stronger, more resilient, and inclusive growth requires us to invest in the future. This means investing in people, by strengthening health systems and social protection systems, but also by boosting human capital and economic opportunity. And the latter requires investing in education and training, especially as we look ahead to advances in technology and what that means for the future of employment”.
She is optimistic that with the right mix of green investment and higher carbon prices, we can steer toward zero emissions by 2050 and help create millions of new jobs.
The IMF Deputy Managing Director also noted that investing in digital transformation is important to unlock greater economic potential.
“Strong economic institutions and technical know-how are central to designing and implementing such policies. This is why, in addition to financial support, the IMF is providing real-time policy advice and capacity development support”.
According to her, the IMF works with countries to tackle debt problems and rebuild fiscal space by modernizing tax systems and administrations and by increasing spending efficiency. She added that the Fund also supports countries to address equity concerns, for example through advice on taxation and gender-responsive budgeting.
Recent analysis shows that many countries covered by the Joint Vienna Institute (JVI) have large infrastructure needs and that addressing them could have a significant growth impact. But this entails more efficient investment —and this is where the IMF can provide technical advice and the Joint Vienna Institute training can empower officials in charge of these reforms.
Together with the JVI, the IMF is also developing an integrated approach to inclusive growth, which draws on best practices across several themes such as jobs, gender, inequality, trade, governance, and climate change. This will include training to policymakers and the public, including through a new online course and a guidebook of policy recommendations.
“These are exceptional times that call for exceptional action. Since the start of the pandemic, the IMF has moved at an unprecedented speed to approve over $100 billion in the financing, helping 81 countries ramp up emergency spending.
“We have also provided closely-integrated capacity development assistance to help strengthen institutions that can more effectively tackle the challenges brought by the pandemic. Over 90 percent of countries that benefitted from emergency financing in recent months have received capacity development support through hands-on technical assistance, practical tools, and training”.said Sayeh.
Leave a Reply