IMF Economic Report Calls for Global Cooperation on Taxation‎

The International Monetary Fund (IMF) released its bi-annual report on the state of the global economy, predicting that global growth will continue steadily but slowly.

The report also raised the alarm on policies it labeled as “protectionism.” The IMF expresses concern about the rollback of transparency regulations leading to a return of riskier global investing.

“‎While the IMF reports that growth is slow and steady, it is clear that the IMF is concerned with the return of the kind of risky behavior that helped create our recent global financial crisis,” noted Eric LeCompte, the Executive Director of Jubilee USA and an expert on United Nation finance groups. LeCompte has tracked IMF economic reports since 2010. “The IMF is concerned with a shift in global politics.”

The report also noted that curbing tax evasion and avoidance needs global or “multilateral” cooperation.

“We know that in order to curb tax avoidance and evasion, we need agreements that can cross the borders of countries,” commented LeCompte on the taxation elements of the report.

The World Economic Outlook report noted that both low and middle income countries should be concerned about rising debt levels. The IMF views high debt as being a substantial risk in weak economies.

“It’s good the IMF is pointing to concerns of sustainable debt levels in poor countries,” stated LeCompte.‎ “I’m concerned that higher debt levels and more risky market behavior is a recipe for another financial crisis.”

The report noted that with buoyant financial markets and a long-awaited cyclical recovery in manufacturing and trade, world growth is projected to rise from 3.1 percent in 2016 to 3.5 percent in 2017 and 3.6 percent in 2018. “But binding structural impediments continue to hold back a stronger recovery, and the balance of risks remains tilted to the downside, especially over the medium term,” it said.

“Emerging market and developing economies have become increasingly important in the global economy in recent years. They now account for more than 75 percent of global growth in output and consumption, almost double the share of just two decades ago,” IMF report added.

 

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