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| IMF urges world leaders to take immediate action to combat growing risk to global economic stability [Image: UNiffed] |
Tokoy: International Monetary Fund Managing
Director Christine Lagarde on Thursday urged world leaders to quickly confront
growing risks to global economic stability.
"We expect action. And, we expect
courageous and cooperative action on the part of our members," said
Lagarde as the 188-member institution opens its annual meetings. The
International Monetary Fund and World Bank Group are meeting in Tokyo this
week.
Risks to global financial stability have
increased and financial markets have been volatile as European policymakers
grapple with the ongoing crisis, the IMF said in its latest Global Financial
Stability Report, issued this week in Tokyo.
Faltering market confidence has led to
capital flight from countries on the periphery to the core of the euro area.
This has meant higher borrowing costs for countries on the periphery.
Lagarde said that financial leaders will
seek to reinforce the recovery of the world economy.
"And
we really want to, together with our members go through what needs to be done,
what action needs to be taken in order to make sure that recovery is not just a
little bounce, but is really here for the longer term and is sustainable,"
Lagarde said.
Lagarde
also praised a recent initiative to strengthen the finances of the Poverty
Reduction and Growth Trust (PRGT), the IMF's concessional lending vehicle that
lends to poor countries.
The fund plans to distribute $2.7 billion
in windfall profits from 2009-2010 gold sales to the PRGT. IMF officials have
said the added funding will bolster the PRGT's lending to poor nations.