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As global markets crash and the world burns, leaders keep fiddling

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As bankers and policymakers converge on Bali this weekend for the annual meetings of the International Monetary Fund and World Bank, the question everyone is asking is: how should we respond to the changes that are about to sweep the world at all levels?

Although three authoritative reports suggest things aren’t so bad now, there is little room for complacency. More people worry a perfect storm in the financial markets is looming on the three-year horizon, while scientists say we have 12 years left to deal with climate change.

The IMF’s latest World Economic Outlook report expects slightly lower growth for 2018 and 2019, and notes higher risks. The global economic growth forecast for the two years is down from 3.9 per cent to 3.7 per cent, which is still the same as the rate last year, and better than the growth between 2012 and 2016. As a number of important economies are nearing full employment, there are growing concerns over the return of inflation, and higher interest rates are on the cards. Policymakers are urged to “build resilience and implement growth-enhancing reforms”.

Fed chief puts Trump in his place as world braces for slowdown

The accompanying Global Financial Stability Report says the global financial system is stronger than it was before the financial crisis a decade ago, but it remains vulnerable if interest rates rise. According to the IMF Blog, “In economies with globally systemically important financial........

© South China Morning Post