Author: |Posted: 11:10 am on 23/11/09
Category: Faisal Islam on Economics
In the not-very-funny economics joke, the IMF stands for “it’s mostly fiscal”.
That’s a reference to its long-held ideology of forcing developing countries to cut spending and budget deficits in response to almost any financial crisis. It was a sort of cosmic chastity belt on fiscal profligacy.
So what better ally for the prospective iron prime minister David Cameron, and his plan for an “emergency budget” to deal with Britain’s “debt crisis”?
Well, incredibly, I would argue, Dominique Strauss-Kahn appears to have pulled the rug from underneath David Cameron. read more
Author: |Posted: 2:25 pm on 16/07/09
Category: Faisal Islam on Economics
There are many men in dark glasses in Washington DC during the summer. Amongst the most feared have been the International Monetary Fund economists who fly around the world reviewing the policies of individual countries – so-called Article IV Consultations.
Such a team has been in the UK over the past weeks and a few moments ago I heard them issue the single most important external report on the UK economy from their headquarters in Washington DC. In it the IMF staff project that gross government debt could reach 100 per cent of GDP by 2014/2015 or 87 per cent on the net debt measure.
Britain seems to be being advised to engage in the sort of ‘Structural Adjustment’ of borrowing policies that the IMF used to force upon bankrupt developing countries. The IMF want the UK to come up with ’specific measures’ – ie the detail of spending cuts.
read more
Author: |Posted: 6:34 pm on 15/05/09
Category: Faisal Islam on Economics
Schadenfreude. As the cast of Avenue Q sing so admirably, “it’s German for happiness at the misfortune of others”. There may be a touch of it around the Treasury today.
For months, they were told by the likes of the IMF that the UK would suffer the most stinkingly heinous recession of all the world’s advanced nations. Well, how about the figure for German GDP growth this morning? read more
Author: |Posted: 1:20 pm on 11/05/09
Category: Faisal Islam on Economics
Economic diplomacy is back in a big way. That was the message from last month’s G20 summit, and it continues today with high-level UK-China chinwag.
The system that failed the world plunging trade and global growth to contractions not seen since World War Two was a system that was international. Gaps in regulation existed between nations. Massive imbalances between nations affected borrowing, currency markets, and global credit availability. read more
Author: |Posted: 11:38 am on 22/04/09
Category: Faisal Islam on Economics
“Building Britain’s Future” is the title of today’s budget, but it will be a document mired in the past. The figures released at lunchtime will make the wrong sort of long-term history, marking public debts and deficits never before seen in peacetime.
But really this is a budget about recent history, about the calamitous carnage wrought by the credit crunch on Britain’s public finances. It could be called the hangover budget.
Firstly, despite the wobbles of the IMF, we will get the first indication of the direct bill read more
Author: |Posted: 5:19 pm on 21/04/09
Category: Faisal Islam on Economics
UPDATE: The IMF retracted its claim.
ORIGINAL POST: The IMF has hugely upgraded its projection for the likely total costs of the bank bailout.
In today’s Global Financial Stability Report the costs of financial stabilisation are put at a whopping 13.4 per cent of GDP, or £200bn. This brings the IMF in to line with the estimates from the experts in our special investigation last month. read more
Author: |Posted: 2:00 pm on 01/04/09
Category: Snowblog
I have just emerged from the World Bank offices in Millbank and an interview with its president, Robert Zoellick. He has a formidable intellect and interesting moustache.
He too had a flyer’s cold. I told him of the benefits of squirting saline water up your nasal passages in the morning and at night. He was grateful.
He says it’s not just the fear of protectionism, but the reality. read more
Author: |Posted: 3:29 pm on 20/03/09
Category: World News Blog
Zambia is reckoned to be the 13th poorest country in the world. Sixty-four per cent of the people live in poverty. More than one in six children die before their fifth birthday, and if you live to the age of 42 you are doing better than average.
Britain is the largest bilateral donor to Zambia, providing £40mn a year. But what Britain and the rest of the developed world provide may not be enough to stop an increase in children dying because of the global recession. read more
Author: |Posted: 1:59 pm on 04/03/09
Category: World News Blog
RIGA, LATVIA – I am sitting in the Latvian parliament in downtown Riga, waiting for the new Prime Minister Valdis Dombrovskis to show up for an interview. And the words of a local economist are ringing in my ears.
“Anyone who wants to run this country must have a death wish,” he told me on the phone during my prep for this trip last week.
Latvia’s economy is set to contract by around 12 per cent this year – the biggest collapse in Europe. Unemployment could go as high as 25 per cent. read more
