quarta-feira, 21 de janeiro de 2015

Christine Lagarde: the IMF is a contingency plan

By Admin 22:01

Christine Lagarde is one of the most powerful women in the world. She is the Director-General of the International Monetary Fund. We spoke with Lagarde in Dublin, Ireland, but the Greece, the future of the euro area and the global economy in 2015 dominated our conversation.

James Franey, Euronews:

Christine Lagarde, the Lady is the boss of the IMF, is in Dublin to talk about lessons we can learn from the Irish rescue. The Ireland is a good model if we consider the social costs of what happened?

Christine Lagarde, Director General of the IMF:

If you look at the numbers, clearly, the Irish recovery is truly extraordinary because if you look at the growth, is the highest in the euro zone; If you look at the unemployment rate, lost almost 3 percent; If you look at the debt is falling; If you look at the deficit dropped nearly in half. These numbers are solid and in the right direction. Now, we still have unemployment above ten percent among young people and the unemployment rate remains above 20 percent. Therefore, we haven't gotten to the end. Although Ireland has had a good start, there's a lot of work to do to reduce unemployment and create jobs. These are the key points to evaluate the success of Irish recovery.

Euronews:

According to government statistics, there are 750 million people still living in poverty in Ireland. When you hear these stories, about how the austerity cuts have affected people's lives, what feels like the IMF public figure? It's a terrible story of Greek pharmacist 77 years that killed in Athens, because I didn't want to leave debts to their children. What you feel when you hear these stories?

Christine Lagarde:

Like any other person. We feel very bad before these tragedies and the misery that people would feel.

Euronews:

Repented of policies...?

Christine Lagarde:

…But, on the other hand, when we come to a country, when the Government asks for help, he failed to manage the situation. Spent much beyond their possibilities, didn't control the public finances. And the situation was very bad. So we have to help the country regain economic condition, restore the conditions for financing and ensure the economy return to the path of job creation and job destruction.

Euronews:

So philosophy is: remain calm and continue cutting. You couldn't have done anything different from these harsh austerity measures?

Christine Lagarde:

I think in the case of Ireland had a clear goal. There was a focus on financial and tax issue. There was determination. There was no responsibility on the part of the authorities and of many people in Ireland. They wanted to get out of the deep financial crisis they were in. There was also a great human competence for trying to carry the program forward and try to achieve the results, and the jobs are now being created.

Euronews:

Let's talk about Greece. I know it's a sensitive topic, with the election coming...

Christine Lagarde:

Is the reason maybe you can say a lot.

Euronews:

Let's address the issue anyway.

Christine Lagarde:

We try to be respectful.

Euronews:

I understand, but the leader of Syriza, Alexis Tsipras, says he wants a big debt relief, which will ask the troika. Do you think you will get?

Christine Lagarde:

I think we have to wait until Friday. We have to know the election results and trying to figure out what kind of coalition will be established and then recalled that the country has taken on commitments to European partners, with its creditors, and that there are structural reforms should be implemented to restore the Greek economy. So far very little has been made of what has been agreed and there is much work to be done. Not by us, not by European partners by the European Parliament, as Mr Schulz has indicated, but by the Greek people.

Euronews:

And also by some banks in Northern Europe.

Christine Lagarde:

In terms of tax collection, for example, few intermediate goals have been met. When I say that all the Greek people, including the richest should pay taxes, that's exactly what I mean. An effective tax collection is a goal that must be achieved.

Euronews:

Greek debt is sustainable?

Christine Lagarde:

Let's see this when we look at the situation in the next round of negotiations with the authorities, so that the elections are completed and a coalition is working, if it's a coalition.

Euronews:

Has no contingency plan?

Christine Lagarde:

If I had I wouldn't tell, anyway. Thanks for trying, but I don't.

Euronews:

So what's at stake?

Christine Lagarde:

By the way, the IMF is a contingency plan almost whenever we are called by some of our members.

Euronews: what's at stake in Greek elections?

Christine Lagarde:

It is a vote. It is up to the people to decide democratically what you want, what you expect and what kind of future you want.

Euronews:

The maintenance of Greece into the euro area?

Christine Lagarde:

It's not for me to decide, is a matter to be discussed by Greece and the European partners. But I've heard a lot of comments and I'm sure you too.

Euronews:

What would be the consequences of an exit of Greece from the eurozone? I know it's a hypothetical question, but I'm just interested in your point of view as Director-General of the IMF.

Christine Lagarde:

On the question of a hypothetical Member enough to leave the euro zone, as far as I know is not possible under the partnership agreement in the euro zone, but the result would be a massive financial cost.

Euronews:

Now let's discuss the global economy. What are the main challenges to 2015?

Christine Lagarde:

Growth and employment, which is not much different from 2014, except that we are concerned about the potential growth of many advanced economies, with the exception of the United States. America is clearly in a recovery phase. Is growing strongly, what we're not seeing in the euro zone, nor in Japan. We see it in the United Kingdom...

Euronews:

And why not in the euro zone?

Christine Lagarde:

The combination of a gradual and slow recapitalization, over time, and the fact that very low inflation exists is clearly having an effect on growth potential and the level of confidence; which may result in a dangerous species of a vicious circle from which it takes out to restore confidence and promote investment again and restore economic growth.

Euronews:

One last question, if I may address your personal career. Like all good politicians and public administration servers, the Lady is focused on his current mission, but Nicholas Sarkozy...

Christine Lagarde:

Already got your answer ....

Euronews:

Nicholas Sarkozy's return to politics in France. When he was in the French Government were both very close. Now he is the leader of the UMP, the opposition. If Nicholas Sarkozy called him and asked him to return to French politics, what would you say?

Christine Lagarde:

I'm not going to comment on the French policy.

Euronews:

No plans?

Christine Lagarde:

... because it is not my mission, not part of my interests.

Euronews: do not plan to return to French politics?

Christine Lagarde:

I told you, I'm not going to answer.

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