Lower forecasts, but reason to be hopeful at the World Bank/IMF Annual Meetings
As the World Bank and International Monetary Fund annual meetings wrapped up in Washington, DC on Sunday, finance ministers and bankers from around the world expressed deep concerns that the global economy is slipping backward. The IMF is now putting 2014 expansion at a tepid 3.3 percent while giving a more hopeful forecast of 3.8 percent in 2015. But a different concern, Ebola, overshadowed the weak economic outlook.
The hemorrhagic disease, which the African Development Bank Group has already contributed $210 million to fight, dominated a number of panels and bilateral discussions this week beginning with the “Impact of the Ebola Crisis” panel Thursday morning.
That is where AfDB President Donald Kaberuka cautioned the world to “be careful with doomsday narratives.” He told delegates including the IMF’s Managing Director, President of the World Bank Group, the Secretary-General of the United Nations, the Director of the US Centers for Disease Control and Prevention along with the Presidents of the three hardest-hit nations that “the narrative getting out of this room must be one which says we can overcome Ebola.”
It was a message Kaberuka repeated in bilateral talks and forums including the WB/IMF Development Committee meeting, a session on the data revolution in Sub-Saharan Africa, the State of the African Region seminar and more.
He asked the international community to increase the flow of resources, worked to boost investor confidence in affected countries, urged preparation to battle the next epidemic and called for member nations to strengthen health systems in Liberia, Sierra Leone and Guinea. One priority, Kaberuka said this week, is the need for greater “budgets for governments of those countries so they can do what governments do” to protect citizens.
Kaberuka’s early push this week to reframe the approach to dealing with Ebola helped galvanize a week of increased attention and action to finance the fight against the disease, which has already taken more than 4,000 lives.
The IMF agreed to increase fiscal deficits of the countries at the centre of the outbreak, and the World Bank fast-tracked a $105 million aid package to fight it.
“Usually the World Bank Group has worked in the medium to long term on development projects,” said President Jim Yong Kim. “To combat Ebola, we needed to move to an emergency footing and quickly.” He added that “we must act now because delay exponentially raises the human and economic cost of stopping the epidemic.”
Though financial markets around the world fell after the weak growth forecast coming out of this week’s meetings, Kaberuka says he remains “bullish on Africa.”
The next Spring World Bank/International Monetary Fund meetings are set for April 2015 in Washington, DC.