Environmental sustainability will be one of the criteria of the IMF annual review

The executive director of the International Monetary Fund (IMF), Kristalina Georgieva, said Tuesday that the assessment of environmental sustainability will be one of the aspects of the annual evaluation that the Fund makes to its Member States under Article IV.

"We are preparing for a very rapid increase in the inclusion of climate in the considerations we make under the annual review of economies, in Article IV," Georgieva said during a speech on the sidelines of the summit on the financing of African economies, held yesterday in Paris, a day after the Peace Summit, which was dedicated to the impacts of the pandemic on the least developed countries.

For the IMF official, the pandemic is having deep and lasting impacts, even in terms of the organization of the Fund itself: "In the wake of the pandemic, we created a position to issue policy recommendations to member states to deepen projects with environmental impact and to empower women in the economy.

Georgieva said that although the pandemic hit all economies, women were the biggest losers, and among these were mothers with lower-skilled jobs and dependent young children.

"We talk about a recession [recession, in English], but some people talk about a 'shecession' and even a 'momcession,' because this pandemic hits women who have young children and less skilled jobs unequally," Georgieva said, citing an internal IMF study on the pandemic's impact on household incomes.

"There are going to be structural changes as a result of this pandemic, we are now more aware of inequalities, but the IMF is here to help countries set policies, and among these we are going to push very hard for tax progressivity," that is, taxes that increase as incomes rise.

The official considered that "there are parts of the economy that are doing very well, and other parts that are on the edge of the abyss", that "there has to be a fair distribution of gains" and that this distribution "promotes the digital economy, green, sustainable, climate resilient investments, and enhances talent".

The Paris Summit brings together dozens of African and European leaders, as well as officials from international organizations, to promote discussions and find solutions for the financing of African economies, which are facing a reduction in revenue and an increase in the cost of public debt that limits investment in economic development.

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