The International Monetary Fund (IMF) urged G20 to continue implementing reforms in order to rebalance their economies and ensure the sustainability of growth.
“After a slow recovery, growth has strengthened and output gaps are expected to close in about half of the G20 by 2018,” said the IMF in a G20 surveillance note which was prepared for the IMF/World Bank annual meetings next week.
“Growth is stronger, but there remain pockets of concern,” the IMF added. Many advanced economies continued to see insufficient demand and below-target inflation; some emerging economies are facing challenges from low commodity prices.
In both advanced and emerging economies, slow expansion of potential output and stalling productivity growth are threatening the sustainability of higher growth, said the IMF.
The rising public and private debt and stalled external rebalancing also indicated that imbalances remained in G20 economies, the IMF added.
“The current growth momentum is an opportunity to implement these policies and sustain the recovery,” said the IMF.
According to its policy recommendations, advanced economies, such as U.S. and Japan, need to carry out more ambitious fiscal consolidation plans in order to bring down public debt, while several emerging economies and the euro area should address corporate and bank vulnerabilities.
The IMF also called for joint action to ensure sustainable and rebalanced growth. “Joint action will also be a key in successfully tackling new shocks affecting the global economy and preserving the benefits from global trade integration,” it said.—Xinhua