‘Winter is coming,’ IMF told at Bali summit
October 15, 2018, 9:09 am

Indonesian President Joko “Jokowi” Widodo urged the 189 members of the International Monetary Fund to work together to avoid a global economic calamity

IMF Chief Christine Lagarde acknowledged the global imbalances caused by trade and that these may have fueled populism [PREUSS]

He made this reference in front of a packed hall at the plenary session of the International Monetary Fund (IMF) and World Bank Annual Meetings in Nusa Dua, Bali, over the weekend.

“With all the problems that the global economy currently faces, it is appropriate to say that ‘winter is coming’,” Jokowi said.

He said weak coordination and cooperation, particularly on the part of developed countries, had resulted in additional uncertainty in the global economy, citing the drastic increase in the global oil price and turmoil in the financial markets of emerging markets as recent examples.

“We rely on you, the world’s fiscal and monetary policymakers, to maintain the commitment to global cooperation. I am very hopeful that you, sirs and madams, will contribute to encouraging the world’s leaders to respond appropriately to the situation,” Jokowi said.

To curb the impact of climate change, for instance, the world may need to increase an annual investment in renewable energy by around 400 per cent globally, to save the planet and many lives, he noted.

“I do hope you will do your part to encourage leaders to address the situation appropriately. Monetary and fiscal policies that can shoulder trade wars, technology disruption and market uncertainties are necessary,” he said.

IMF chief Christine Lagarde, also spoke at the same event, and acknowledged the global imbalances caused by trade, which despite having created prosperity, also caused a backlash, as too many people felt that they had been left behind, which is why there has been an upsurge in populism globally.

To cope with the changing economic landscape, she proposed a “new multilateralism”, which is “more inclusive, more people-centred and more results-oriented”.

“This partnership is integral to the new multilateralism – not least because tensions arising from exclusion and climate change do not respect national borders. In that sense, solidarity is self-interest,” she said.

World Bank President Jim Yong Kim warned that time is running out for governments to implement programmes aimed at curbing global warming.

“Climate change is an existential threat to global development and efforts to end poverty. The warming planet is already having an impact on the poor and most vulnerable,” Kim said.

Helmo Preuss in Nusa Dua, Bali at the International Monetary Fund meetings