As the world faces a prolonged period of economic weakness, demographic changes and the imperative need to transform its processes to green technology, the urgency for structural reforms is clearer than ever, declared the International Monetary Fund (IMF).
“Policymakers are urged to implement measures that encourage competition, allocate resources to emerging sectors and strengthen labor supply
in the midst of an aging population,” the organization urged in the introduction to Chapter 3 Understanding the social acceptability of structural reforms, which is part of its Economic Expectations Report.
In the document released today, a few days before the annual meeting of the IMF and the World Bank, which will be held from October 21 to 26 in Washington, where leaders of governments, companies and international organizations will meet, the financial institution highlighted that structural reforms must be supported by a solid institutional framework that fosters trust and two-way dialogue from the early stages of policy design.
“It is essential to conduct thorough consultations with all stakeholders and the public to identify mitigation measures, measures to address personal and social concerns that undermine support for reform,” the analysis mentions.
Designing structural reforms will help boost productivity, employment and growth, he noted.
IMF analysts argued in the report that the global economy has been enduring a prolonged period of structural weakness and that the outlook under current policies remains bleak.
He explained that the slowdown in global growth is largely attributable to
aging of the population, low levels of investment and structural problems.
that make capital reallocation difficult.
“This is especially worrying because demographic pressures are expected to continue, and structural transformations related to the green transition and technological changes will require significant investments and reallocation of resources,” they warned.
“In this context, policymakers are urged to advance structural reforms, that is, update the rules and policies that shape the functioning of an economy: boost productivity, employment and growth,” he reiterated.
They specified that priorities include alleviating entry barriers and promoting
competition in markets to facilitate the reallocation of resources between different economic sectors, which will help countries take advantage of the potential benefits of new technologies.
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