You are using an older browser version. Please use a supported version for the best MSN experience.

IMF's Lagarde: 'Concerned' about trade

USA TODAY logo USA TODAY 4/20/2017 Roger Yu
International Monetary Fund (IMF) Managing Director Christine Lagarde, gestures while speaking at a news conference during the World Bank/IMF Spring Meetings at IMF headquarters in Washington,© Jose Luis Magana, AP International Monetary Fund (IMF) Managing Director Christine Lagarde, gestures while speaking at a news conference during the World Bank/IMF Spring Meetings at IMF headquarters in Washington,

Referring to the Trump administration’s inward-looking economic policies, Christine Lagarde, managing director of the International Monetary Fund, said Thursday the organization is “concerned” about trade and urged countries to refrain from adopting protectionist measures.

“Trade is a major engine for growth, one of the pillars of prosperity,” she said in a press conference to kick off the IMF’s 2017 spring meetings in Washington, D.C. “We will certainly be looking at how we can participate in that and how it can be done in as efficient, fair and global ways as possible. That requires a level playing field…not protectionist measures.”

President Trump has signaled his intent to evaluate current trade deals and vowed to renegotiate them to help U.S. companies and curb the nation's growing trade deficit. 

Lagarde downplayed any potential conflict with the White House on trade issues, saying she has "every reason to believe that we will make progress, that we will cooperate all together in order to support and indeed improve the system as we have it."  

But she acknowledged that international trade agreements are rife with non-compliance violations -- about 3,000 violations worldwide since 2008 -- and dispute settlement mechanisms need improvement. "I've been saying that for two years. We will contribute our part," she said.

But subsidies and other measures that restrict trade are "self-inflicting wounds," she said. "There are two clear forces that drive productivity --innovation and trade. We need to keep that growing." 

Lagarde didn't refer to Trump directly, but her comment echoes similar warnings she has issued in recent days regarding trade. Speaking at a press conference earlier this month in Berlin, she said global economic growth could be cut off by a "sword of protectionism."

Following the IMF’s upward revision of global economic growth, Lagarde expressed optimism that “spring is in the economy as well.”

“We’re finally seeing the global economy picking up the momentum we hope is going to be sustained medium and longer term,” she said. “It is warmed by rays of sensible policies.”

Earlier this week, the IMF estimated the global economy will grow 3.5% this year and 3.6% in 2018. That compares with 3.1% growth last year.

“We need to make sure that this momentum is sustained…that growth is shared more equitably,” she said. "We need to make sure that global growth is more inclusive."

Her policy proposals included "making tax and benefit systems more equitable" and boosting infrastructure investment. She also urged countries to "mitigate the impact of structural changes" by possibly raising minimum wages, providing income tax credit, increasing job training, and facilitating labor mobility through relocation support and job search help. 

Global economic growth could also be stymied by actions that could hurt future generations, she said, referring to debt burden, unsustainable pension systems, not maintaining infrastructure and the impact of climate change.  

Follow USA TODAY reporter Roger Yu on Twitter @ByRogerYu.

AdChoices
AdChoices
AdChoices

More From USA TODAY

image beaconimage beaconimage beacon