Lagarde: The world has to spend more to meet its development targets

September 18, 2018 9:38 amComments Off on Lagarde: The world has to spend more to meet its development targetsViews: 13

Christine LagardeThe world needs to increase its spending if wants to meet its ambitious goals of poverty reduction and environmental protection adopted by the UN. This was stated by the director of the International Monetary Fund (IMF) Christine Lagarde in a speech in London.

“For the low-income countries in particular, meeting the additional spending needs will require a strong partnership between all stakeholders – countries themselves, but also official donors, philanthropy, and private finance”, said Christine Lagarde.

And while she is optimistic that this may happen, the IMF director has warned that meeting the set targets becomes more difficult as low-income countries are facing rising levels of debt.

In her address, the IMF director urged all parties to prioritize development goals, as – in her words – this is in their interest. “Without sustained home development, growing economic and social tension – worsened by the sharp population growth and rising environmental stress – will surely go beyond the state borders, including through the mass movement of people”, added she.

The UN General Assembly adopted its sustainable development goals in 2015 with the intention of being implemented by 2030. The seventeen targets include the promise of ending extreme poverty, defined as a life of less than 1.25 USD per day, eliminating discrimination against women, inequality, and combating climate change.

The IMF’s warning comes on the background of threats from some developed countries to emerge from global co-operation institutions because of growing populist moods. The US President Donald Trump has already threatened to pull the United States out of the World Trade Organization (WTO) and Britain is preparing to leave the EU next year.

“And while some regions have made significant progress in combating poverty in recent decades, income inequality remains one of the major challenges of the global economy”, said Christine Lagarde. In her words since the 1980s, the income of the world’s richest 1% has grown at a double faster rate than the poorest 50%.

She also added that inequality is rising in most wealthy countries.

According to Christine Lagarde, the growing gap is partly due to new technologies, to “global integration” and to policies that give preference to capital for labor.

At the same time, climate change continues to “cast an increasing shadow”, said Lagarde, pointing out that the best way to tackle the problem is carbon pricing by carbon levy.

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