IMF Managing Director Christine Lagarde has praised Europe’s efforts to tackle its sovereign-debt crisis and said the “breathing space” should be used to complete the repair work on the global economy.
Speaking ahead of next week’s spring meetings of the IMF and the World Bank, Lagarde said the policy moves taken in Europe had helped ease the strain and meant the IMF no longer needed quite so big a war chest to deal with the problems left behind by the financial crisis and recession.
“The steps taken by the Europeans in recent months are a timely reminder of the power of policy resolve and action,” Lagarde said in a speech at the Brookings Institution in Washington.
Photo: Bloomberg
She urged European policymakers to “keep up and build on” their efforts, including through action in individual countries, support from the European Central Bank [ECB], repairing the banking system and fiscal integration.”
“The much-expected decision of euro area ministers to strengthen the European financial firewall has also been crucial,” she said.
Lagarde’s comments came as Italy was forced to pay sharply higher interest rates when it auctioned 5 billion euros (US$6.59 billion) worth of bonds on Thursday, underlining anxiety in financial markets about the health of the eurozone’s crisis-hit economies.
The Italian government, which is pushing through a series of unpopular economic reformsh, raised 4.88 billion euros from investors, but was forced to pay an average yield of 3.92 percent for three-year loans, far higher than the previous auction last month.
Markets were rattled by the tricky sale, although bond yields fell in afternoon trading, amid rumors that the ECB might have resumed its emergency purchases of Spanish and Italian bonds in a bid to prevent borrowing costs reaching unsustainable levels.
With Spain still in the markets’ sights too, Spanish Prime Minister Mariano Rajoy repeated his insistence that his country would not need financial aid.
“Nobody is considering a bailout, it is on nobody’s agenda,” he told a press conference in Poland, where he was on an official visit.
He also said he had spoken with Italian Prime Minister Mario Monti, who had denied blaming Spain’s travails for rocketing Italian bond yields. Meanwhile, unemployment in Greece rose to 21.8 percent, up from 12.5 percent two years ago.
Soros Fund Management chairman George Soros said that Europe’s “deflationary debt trap threatens to destroy a still incomplete political union.”
In an article in the Financial Times, Soros said the euro had entered a “more lethal phase” and outlined a series of measures to solve the crisis — including an idea that all countries should be able to refinance their debt at the same interest rate.
The number of Taiwanese working in the US rose to a record high of 137,000 last year, driven largely by Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) rapid overseas expansion, according to government data released yesterday. A total of 666,000 Taiwanese nationals were employed abroad last year, an increase of 45,000 from 2023 and the highest level since the COVID-19 pandemic, data from the Directorate-General of Budget, Accounting and Statistics (DGBAS) showed. Overseas employment had steadily increased between 2009 and 2019, peaking at 739,000, before plunging to 319,000 in 2021 amid US-China trade tensions, global supply chain shifts, reshoring by Taiwanese companies and
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) received about NT$147 billion (US$4.71 billion) in subsidies from the US, Japanese, German and Chinese governments over the past two years for its global expansion. Financial data compiled by the world’s largest contract chipmaker showed the company secured NT$4.77 billion in subsidies from the governments in the third quarter, bringing the total for the first three quarters of the year to about NT$71.9 billion. Along with the NT$75.16 billion in financial aid TSMC received last year, the chipmaker obtained NT$147 billion in subsidies in almost two years, the data showed. The subsidies received by its subsidiaries —
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