Acknowledging that the current model of development has increased disparity between the rich and the poor, world leaders, including US President Barack Obama, have called for global cooperation to promote inclusive growth strategy.
“We need to push back against threats to global cooperation and build a global economy that works for everybody,” Obama said in his address at a meeting of International Monetary Fund and the World Bank leaders.
The meeting held here this week was attended by finance ministers from countries all over the world. The Indian delegation was led by Union Finance Minister Arun Jaitley.
In his address, Obama called IMF to continue promoting strong, inclusive and balanced global growth, with fiscal policies to increase demand, support structural reform and reduce economic inequality.
He asked the World Bank to continue addressing the most pressing global challenges, from tackling climate change to responding to the global refugee crisis, to championing investment in countries experiencing fragility, violence and conflict.
In its communique issued after the conclusion of the meeting, the IMF reinforced its commitment to strong, sustainable, inclusive, job-rich and more balanced growth.
“We will use all policy tools — structural reforms, fiscal and monetary policies — both individually and collectively,” it said.
IMF Managing Director Christine Lagarde stressed on the need for more inclusive growth in the absence of which she warned of the threat to growth from the political backlash against globalisation.
“We need growth, but we need inclusive growth. We need transition to the digital age, but a transition that benefits everyone. And we need to accelerate now,” she said.
Deputy Prime Minister of Japan and Governor of the IMF for Japan said inclusive growth was important for sustained macroeconomic growth.
The issue of shrinking middle class and labour market duality have been pointed out in Japan, too.
“Under these circumstances, we plan to take measures that would contribute to achieving inclusive growth, such as raising the minimum wages by 3 per cent, which was implemented this month, and ensuring equal pay for equal work,” he said.