The IMF chief economist on Wednesday urged countries to put structural reforms at the heart of their policy agendas while strengthening economic growth.
“Structural reforms are bound to return in full force, after having – rightly – taken the back seat since the start of the pandemic," Gita Gopinath told a virtual ministerial meeting of Asia-Pacific Economic Cooperation (APEC) – an inter-governmental forum for 21 member economies in the Pacific Rim that promotes free trade.
Though a global recovery is underway, it stays unequal and fragile, she added.
“In the years ahead, structural reforms will be critical to address what I see as four fault lines of the pre-COVID world economy that the pandemic has aggravated; slow progress in raising living standards, highly unequal progress across demographic groups, rising public debts, and insufficient global public goods.”
According to her, countries need to finance these priorities while strengthening public finances.
“International cooperation is central, but to raise living standards, reduce inequality and slowly curb public debts within APEC and other economies, structural reforms are also going to be critical,” she underlined.
Gopinath noted local reforms and global cooperation are central in structural policy areas, from health to taxation to climate change, playing a key role in putting the world economy on a stronger footing than pre-pandemic level.
"The challenge may seem daunting, but the stakes are high," she stressed, saying credible medium-term fiscal frameworks as well as tax and spending reforms will help lay the ground for a fairer post-COVID era.