Washington (EFE).- The US Treasury Secretary, Janet Yellen, stressed on Tuesday that, although we must remain vigilant about the risks facing the global economy, we must not “exaggerate the negativity” that they anticipate in this regard. organizations such as the International Monetary Fund (IMF).
“I would not exaggerate the negativity. I think we should be more positive. Of course there are risks. Many of them are related to Russia’s war against Ukraine (…). The best thing we could do to improve the global outlook would be to end that savage war, but I think the outlook is reasonably bright,” he told a news conference.
Yellen spoke in the framework of the spring meetings of the International Monetary Fund (IMF) and the World Bank (WB), which began on Monday and ended on the 16th.
The IMF report
The IMF indicated in its outlook report that the global economy will continue to slow down in 2023 and will only grow 2.8% this year and 3% next year.
The Fund warned that these figures are historically very low, although it pointed out that in no case do they represent a recession, and stressed the current uncertainty.
With many countries still absorbing the effects of the pandemic or the Russian invasion of Ukraine, inflation still very high and tighter financial conditions making recovery difficult.
“I think the outlook is reasonable, certainly brighter than the last time we had the annual meetings, in October. Global growth projections are higher than they were at the time. We are seeing reduced inflation projections and lower inflation in some parts of the world,” Yellen said.
In his initial speech, he recalled that during the G20 summit in February he had already said that the global economy was doing better than anticipated in October, noting that this outlook remains largely unchanged.
Yellen’s answer
The Treasury representative stressed, for example, that the United States is doing “extremely well economically.”
His labor market, as he gave as an example, remains strong. The Bureau of Labor Statistics published last Friday that the unemployment rate fell one tenth in March.
And it stood at 3.5%, with 236,000 new jobs, solid data although 75,000 less than in February.
“But we remain vigilant for downside risks. For a year now, the world has been facing the negative consequences of Russia’s illegal war against Ukraine,” he added, hoping for greater allied coordination in supporting Ukraine in its defense of Russia.
Yellen also mentioned that “many countries are still recovering from the blow of the pandemic” and that, in many others, including the United States, “there have been recent pressures on their banking systems.”
United States Government Positivism
The Treasury representative also considered that there is “broad margin for improvement in the international debt restructuring process” and warned that the impact of the debt crisis “does not respect borders.”
Therefore, he said he was “looking forward” to strong talks this week on the Common Framework for the Treatment of Debt for low-income countries.
This spring meeting will be the last for David Malpass as WB chairman, after announcing in February that he will step down on June 30.
Indian-American Ajay Banga is the only contender for his succession.
“I believe he has the right leadership and management skills, along with the necessary experience in building public-private partnerships, to lead the World Bank at a defining moment in its history,” Yellen said of the candidate.