IMF, World Bank meetings to kick off in earthquake-hit Marrakech

Georgieva maintains her expectation of lackluster global economic growth
IMF, World Bank meetings to kick off in earthquake-hit Marrakech
Marrakech prepares for IMF and World Bank meetings (Photo from Reuters)

Starting Monday, October 9th, the annual meetings of the International Monetary Fund (IMF) and the World Bank Group (WBG) will begin in Marrakech. Despite being affected by an earthquake about a month ago, the meetings will proceed as planned. The agenda for the meetings will be intensive, with a primary focus on international economic cooperation and addressing the challenges that have emerged in the wake of the global inflation surge.

Read more: Global debt hits $235 tn in 2022, new IMF report reveals

Despite the significant challenge posed by a devastating earthquake that claimed the lives of thousands in Morocco, the IMF and WBG managed to proceed with their meetings in Marrakech. The Moroccan government expressed its desire for the two financial institutions to provide support in their efforts to rebuild and revive the country’s economy. Morocco placed particular emphasis on the anticipated tourism revenues generated by the event as a crucial factor in the recovery process.

 As announced by the Central Bank of Morocco on Thursday, the event is anticipated to welcome over 14,000 attendees.

Morocco’s Minister of Economy and Finance, Nadia Fettah Alaoui, highlighted that the decision to proceed with the scheduled meetings, despite the earthquake on September 8, reflects Morocco’s strong confidence in these institutions. The successful management of the earthquake’s devastating impact, as directed by King Mohammed VI, further underscores the country’s resilience and commitment.

The official delegations comprising finance ministers and central bankers from Morocco’s 189 Member States are set to convene and engage in discussions on various global economic issues. These discussions will encompass development concerns, financing policies, and the implications of a recessionary environment, further compounded by escalating geopolitical tensions.

As per the IMF, the forthcoming meeting, scheduled to take place from the 9th to the 15th of October, will primarily focus on fostering economic resilience, implementing structural reforms, and revitalizing global cooperation.

Additionally, the meeting will encompass six key themes that will be addressed, namely financial and digital inclusion, sustainable development, reform of international financial institutions, entrepreneurship and innovation, social safety nets, as well as tolerance and coexistence.

Sluggish growth

Kristalina Georgieva, IMF’s managing director, on the eve of the meeting, reiterated her expectation of a continued sluggish growth for the global economy.

During a speech delivered in the city of Abidjan in Ivory Coast on Thursday, Georgieva highlighted that the global economy has demonstrated remarkable resilience. 

Nevertheless, despite the robust demand for services and advancements in addressing the issue of escalating consumer prices, the global growth rate has remained sluggish. It has fallen significantly below the average annual rate of 3.8 percent recorded from 2000 up until the period just before the onset of the coronavirus pandemic.

Back in July, the IMF projected a growth rate of 3 percent for both 2023 and 2024. In 2022, the global economy experienced a growth of 3.5 percent.

$3.7 trillion

Georgieva explained that due to successive shocks, including the pandemic and Russia’s invasion of Ukraine, the world has incurred a loss of approximately $3.7 trillion in economic output since 2020. These losses have been disproportionately distributed, with the poorest nations experiencing the most severe impacts.

The IMF is set to unveil its latest economic outlook on the upcoming Tuesday. Georgieva stressed that “addressing high inflation remains a top priority” in the forthcoming report.

Economic prospects

Regarding the economic prospects of the African region, Georgieva expressed her anticipation of improvement. However, she noted that the region’s performance has not fully realized its potential and has fallen short of expectations.

The continent has been grappling with external shocks beyond its control, such as the ongoing conflict in Ukraine and climate-related disturbances, she added.

In a recent statement, Georgieva highlighted that Africa would be a key focus area during the meeting, alongside the global economic recovery. She underlined the challenges faced by African countries, particularly related to physical connectivity between states, the elimination of trade and non-trade barriers, and the implementation of a digital currency.

IMF World Bank
Egypt (Photo from Reuters)

Warning to Egypt

On the other hand, Georgieva delivered a stern warning to Egypt, cautioning that unless the country further devalues its currency, it could deplete its valuable foreign exchange reserves.

Since the beginning of 2022, Egypt has undergone three currency devaluations, resulting in the pound losing almost half of its value against the dollar.

Georgieva said Egypt’s delay in implementing further devaluation measures would inevitably lead to worsening consequences. She stressed that the longer the delay, the more severe the situation would become.

In contrast, she commended Egypt, the second-largest borrower from the organization after Argentina, for taking additional measures to rectify the trajectory of its strained economy.

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