NO.029

The Spring Meetings of the IMF and World Bank in Washington on 29-30 April focused on

the world economic outlook and, in particular, recent downgrades of world growth

prospects. Discussion also covered financial packages for crisis affected countries in

Turkey and Argentina, the need for an enhanced focus on crisis prevention, and the

importance of renewed efforts at reducing poverty and strengthening growth in the

low-income countries.

Some of the important themes that were emphasised by Australia were: the

interdependence of world economies; the need for vigilance by policymakers to support

growth through appropriate monetary policy, fiscal policy and ongoing structural reform;

and that one of the most important steps to enhancing world growth, including in

particular the prospects for developing countries, would be decisive steps to liberalise

world trade as part of the next multilateral trade round.

The meetings also discussed steps to enhance the IMF’s efforts at strengthening

the international financial system, reducing vulnerabilities, and improving its capacity

to respond to crises. This included work on streamlining the conditionality attached to

Fund programs, improving surveillance, enhancing the understanding of financial market

issues, and steps to combat financial abuse and money laundering.

Special attention was given at the meetings to efforts by the IMF and World Bank to

strengthen growth and fight poverty. There was agreement on the need for a comprehensive

approach, which includes debt relief, concessional financing, extended market access, and

in particular, helping developing countries strengthen their institutions and maintain

sound economic and social policies.

The meetings reviewed the substantial progress achieved with the enhanced Heavily

Indebted Poor Countries (HIPC) initiative, which is providing substantial debt relief to

HIPCs and what other measures would best address the needs of poor economies affected by

conflicts.

Discussions also included the World Bank’s strategy in middle income countries,

leveraging trade for development, an action program for combating HIV/AIDS and the role of

global public goods in development and poverty reduction.

30 April 2001