'CHEAP OIL WILL NOT HELP GLOBAL RECOVERY'
Lagarde suggested that although growth in the US and a lower oil price has given economies a helping hand, the world is facing a "very strong headwind", in a speech to the Council on Foreign Relations in Washington, "A shot in the arm from cheap oil is good, but if the global economy is weak on its knees, it's not going to help," she said and added:
"Certainly, the drop in oil prices is a welcome shot in the arm for the global economy. Cheaper oil increases consumers’ purchasing power and private demand in oil-importing countries. Depending on how long oil prices will remain at low levels, this could provide a positive contribution to global growth for some time."
The impact of lower oil prices would prove to be an immediate test for many policy makers, she said. "Most importantly, however, the drop in oil prices provides a golden opportunity to cut energy subsidies and use the savings for more targeted transfers to protect the poor – for which the IMF has been pushing hard."
DEEP-SEATED ECONOMIC WEAKNESS
She said, they would be working on interim solutions to address some of the concerns of our other 187 member countries. "The year 2015 must be the ‘year of action’ when policymakers redouble efforts to tackle deep-seated economic weaknesses and show greater political leadership on infrastructure investments, trade agreements, and climate change" she said and went on as follows:
QUOTE FROM PERICLES
"I would like to end with a quote that encapsulates my call for greater leadership and cooperation in service of the global public good. It is attributed to Pericles, the Athenian statesman and orator: What you leave behind is not what is engraved in stone monuments, but what is woven into the lives of others."