The managing director of the International Monetary Fund (IMF), Kristalina Georgieva, considered it incorrect to increase public spending to deal with inflation, for which she invited countries to take measures to support the most vulnerable, in order to prevent the fiscal fuels the rise in prices.

“Fiscal policy has to provide a cushion for the most vulnerable. The risk is whenever there is pressure to do more for everyone and this pressure has to be resisted because, if we go down a very generous path of support (…) then fiscal policy becomes the enemy of monetary policy and makes the fight against inflation much more difficult”, Georgieva said.

The European official added, in this sense, that for those countries with fiscal space, giving this specific support “is easy”, while in those where this room for maneuver does not exist “it is incredibly difficult because the only way in which political tax is reprioritizing spending”.

The message comes at a time when the governments of the eurozone accelerated the adoption of public aid and tax cuts to cushion the impact of companies and families with a record inflation of 9.1 % in August, motivated by the increase in energy prices exacerbated by the Russian war in Ukraine, which has spread to the rest of the shopping basket.

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With information from Doblellave

La entrada The IMF calls for no increase in public spending apareció primero en Bitfinance.

The International Monetary Fund (IMF) recommended companies and countries to increase the diversification of the origin of their imports and that these are more substitutable among themselves as a recipe to cushion future global trade impacts, according to one of the analytical chapters of its report. “Global Economic Outlook“.

In this sense, the IMF considers the policies that, in response to the pandemic, have decided to generate local and national value chains to be erroneous.

“The resilience of the supply chain against “shocks” is better built by increasing diversification away from the domestic origin of inputs and greater substitution of these inputs,” the IMF technicians said in the document.

The definition of diversification used by the IMF has a number of nuances compared to the usual one. When the organization refers to more diversification, it points to the countries of origin, not to the products; to intermediate, not final, goods and services; and to the use of intermediate inputs, not to their production or export.

The organization also managed to quantify the impact of these measures on the Gross Domestic Product (GDP) of the countries. For example, in the event that a country that is a supplier of intermediate inputs registers a fall in the labor force of 25 %, a typical economy would see an eight-tenths decrease in its GDP compared to the estimates. In a scenario where there is great diversification, this drop is almost halved: 0.4 %.

Source: dpa

La entrada IMF recommends diversification for companies apareció primero en Bitfinance.

The Senate of Argentina approved with 56 votes in favor, 13 against the sector led by Cristina Kirchner and three abstentions the agreement signed between the Argentine president, Alberto Fernández, and the International Monetary Fund (IMF).

The agreement will refinance the debt of 45,500 million dollars that will serve to restructure the “stand-by” program received in 2018 during the government of former Argentine President Mauricio Macri.

The vice president of Argentina, Cristina Fernández de Kirchner, who refused the agreement, was not present at the time of the vote, as reported by several media outlets. It is estimated that next Monday the IMF board in Washington will approve the agreement and Argentina will avoid the ‘default’.

This agreement has been the victim of criticism throughout the country. On Thursday, at least eight people, including five policemen, were injured in the protests called by left-wing organizations against the IMF agreement, and a group of protesters attacked the Congress of Deputies with stones and Molotov cocktails in Argentina.

K. Tovar

Source: Elpais

La entrada Senate of Argentina approves the agreement with the IMF apareció primero en Bitfinance.

Peru’s economy registered a year-on-year growth of 13.31 % in 2021, after having accumulated ten consecutive months of monthly growth, according to data published by the National Institute of Statistics and Informatics (INEI).

The figure is slightly above 13 % projection made by the country’s Ministry of Economy and Finance; and in line with that issued by the International Monetary Fund (IMF), which predicted growth of around 13.3 %.

In December of last year, the Peruvian national production, an indicator that reflects the aggregate behavior of the country’s economic sectors, increased by 1.72 % when compared to December 2020.

The good performance in December is explained by the positive evolution of most economic activities, with the exception of fishing, mining and hydrocarbons, construction and the financial sector.

However, other sectors such as accommodation and restaurants, which experienced a growth of 32.07 %, offset the aforementioned falls. Also, transportation, storage and messaging; and the production of the agricultural sector registered strong increases compared to December 2020.

Source: dpa

La entrada Peruvian economy grew by 13.31 % during 2021 apareció primero en Bitfinance.