WORLD finance leaders on Thursday decried a growing populist backlash against globalisation and pledged to take steps to ensure trade and economic integration benefited more people currently left behind. more…
WORLD finance leaders on Thursday decried a growing populist backlash against globalisation and pledged to take steps to ensure trade and economic integration benefited more people currently left behind.
Their comments at the start of the International Monetary Fund and World Bank fall meetings signaled frustration with persistently low growth rates and the surge of public anger over free trade and other pillars of the global economic system.
The meetings are the first since Britain voted in June to leave the European Union and US billionaire Donald Trump secured the Republican presidential nomination with a campaign that attacked trade deals.
“More and more, people don’t trust their elites. They don’t trust their economic leaders, and they don’t trust their political leaders,” German Finance Minister Wolfgang Schaeuble said during an IMF panel discussion in Washington.
“In the UK, everyone from the elites told the people, ‘don’t vote for a Brexit.’ But they did.”
Mr Schaeuble said Germany was trying to “hold Europe together” in the face of rising nationalism, and failure to do so would bode poorly for global economic cooperation.
Last week, the World Trade Organization slashed its global trade volume growth forecast to the slowest pace since 2007, saying it expected it to rise just 1.7 per cent this year, down from the 2.8 per cent it forecast in April.
On Thursday, Latin American finance ministers also expressed concerns about growing protectionist sentiment in advanced economies that threatens to sink trade agreements such as the 12-country Trans-Pacific Partnership, which includes Mexico, Chile and Peru.
“There are isolationist trends in Europe and sadly so in the US,” Argentine Finance Minister Alfonso Prat-Gay told a panel during the IMF and World Bank meetings, holding out hope that cross-border investment within Latin America could still grow.
IMF managing director Christine Lagarde launched the meetings by renewing her call for countries to further boost growth by increasing spending when possible, keeping interest rates extraordinarily low and implementing pro-business reforms aimed at improving economic efficiency.