IMF managing director Christine Lagarde on Thursday said a worldwide economic recovery is taking hold, opening a window for countries to enact reforms aimed at attaining broader, lasting prosperity.
“The long-awaited global recovery is taking root,” she said in an address at the John F. Kennedy School of Government at Harvard University in Massachusetts.
Countries around the globe are seeing renewed or sustained economic expansion, coinciding with greater stability in banks and market confidence, she said.
Photo: AP
“Can the world seize the opportunity of the upswing to secure the recovery and create a more inclusive economy that works for all?” she asked.
Her remarks come the week before the IMF and World Bank are due to begin annual meetings with 189 member nations at which the IMF will unveil updated forecasts for global growth.
In July, the IMF predicted that global growth would hit 3.6 percent next year — the fastest since 2011 and a welcome sign the world economy had broken out of a period of stagnation following the 2007 to 2009 financial crisis.
The IMF since last year has confronted a tide of populism in the developed world, with forces hostile to trade liberalization on the rise in the US and Europe.
However, Lagarde called attention to what she said were dangers on the horizon, including slow growth, mounting inequality in advanced economies and failures in adapting to technological change.
“As a result, our social fabric is fraying and many countries are experiencing increased political polarization,” she said.
Lagarde said inaction would “let a good recovery go to waste,” leading to weak growth, sluggish job creation, fraying social safety nets and leaving financial systems exposed to future crises.
In addition to calling for monetary and fiscal policies that support growth, Lagarde also said countries should invest in infrastructure, research and development to boost productivity and demand, which could reduce unemployment and under-employment.
Expanding access to healthcare and education as well as adopting progressive taxation could help reduce inequality, she added.
“IMF research has shown that excessive inequality hinders growth and hollows out a country’s economic foundation,” she said. “It erodes trust within society and fuels political tensions.”
Lagarde also called climate change “a threat to every economy and every citizen,” saying that a 1?C increase in average annual temperature in country like Bangladesh would cut per capita GDP by almost 1.5 percent.
“Policymakers should use all tools at their disposal to act now,” she said.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts