The IMF, the ECB, the US Treasury and the Bank of Japan have agreed at the closing session of the Davos Forum in its hopeful diagnosis for the evolution of the world economy in 2020, despite the slight reduction in the forecasts of increase.
Last Monday, at the opening session, the International Monetary Fund (IMF) slightly lowered its forecasts of growth of the global economy to 3.3% in 2020 and 3.4% in 2021, due to a slowdown greater than expected in India and the impact of growing social unrest.
However, in a debate held on Friday, representatives of these organizations have stressed that 2020 will be better than 2019.
The managing director of the IMF, Kristalina Georgieva, stressed that “we are better in January 2020 than in October 2019”, mainly due to the reduction of commercial tensions thanks to the agreement between the United States and China, which has unleashed a surge of confidence and has increased investments.
Although she has admitted that a growth of 3.3% “is not fantastic”, it is necessary to go further in monetary and fiscal policies and more aggressive reforms are needed, worldwide expectations have improved, and 40 emerging countries are going to grow above 5%, a good part of them in Africa.
The Secretary of the Treasury of the United States, Steven Mnuchin, has also boasted of the good progress of the economy, who explained that thanks to the economic agenda of President Donald Trump, the country is experiencing a “bright” moment.
A trade agreement with Canada and Mexico has been signed, inflation and unemployment are at very low levels, employment at its best, and the benefits of companies are on the rise, he has listed.
The governor of the European Central Bank (ECB), Christine Lagarde, who for the first time goes to the Davos Forum at the head of this body after several years at the IMF, said that in both the European Union and the euro area they detect positive signs, with good levels of employment and the commercial sector in recovery after the uncertainty caused by tensions between China and the United States.
The managing director of the IMF has nevertheless warned that growth remains low due in part to negative interest rates, although she has recalled with irony the 90s of the last century when the problem was hyperinflation.
Now the challenge is not to become indebted again since with such cheap money “temptation is very strong”.
With the exception of Mnuchin, the rest of the speakers, including the governor of the Bank of Japan, Haruhiko Kuroda, and the vice-chancellor and finance minister of Germany, Olaf Scholz, have highlighted the opportunities it offers to boost growth ” green agenda “which includes, among other things, decarbonization.
Mnuchin has not seconded this discourse and has clarified that climate change “is one more issue, but not the main one,” which should concern economic agents.
Other issues, such as national security or nuclear weapons, have a preferential place on the United States agenda, which can boast clean air and water and is also very efficient in terms of the coal industry.
China or India, he said, still has much to improve.
Nor does Mnuchin share the 30-year-old strategies to fight against climate change, because in his opinion technological changes are going very fast and plans made in such a long term run the risk of becoming obsolete.
Without wanting to “minimize” the environmental agenda, he recalled that there are still billions of people around the world who do not have electricity, something that seems much more serious.
Lagarde has ironic about “the three issues that mobilize the world, which are sex, fear and greed,” of which “only the last two can have effects on the environment.”
In her opinion, the fear of a climate catastrophe is present in public opinion, and greed can be seen in the investment portfolios of large corporations such as Blackrock or Bank of America, which are still far from dying green because they do not end to take the environment seriously.