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IMF chief calls for 'new multilateralism'

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Staff Writer |
Christine Lagarde
World   IMF chief Christine Lagarde

International Monetary Fund (IMF) chief Christine Lagarde urged countries to "reimagine" international cooperation and jointly build a "new multilateralism."

"International cooperation is essential, not optional," said Lagarde, who made the remarks in a keynote speech at the Library of Congress in Washington D.C. Her speech is the latest at the biennial Kissinger Lecture, a high-profile address on foreign policy and international relations.

Recalling the history of the Bretton Woods institutions set up after WWII, which consist of the IMF and the World Bank, Lagarde said that the "collaborative system" was "revolutionary" and "visionary."

But today, "the landscape has shifted," driven by geopolitics and an economic power shift, by multi-national companies and technology innovation, among other factors, said the IMF managing director. "These transformations can bring enormous opportunities but also unprecedented risks."

Elaborating on the risks, Lagarde said: "More than ever before, what happens in one nation can impact all nations. Think about it: From weapons of mass destruction, to cyber-security, to the interconnected financial system, many of our current challenges do not recognize borders."

"Solidarity is self-interest," she stressed.

The chief of the multilateral lender warned that "supremacy of national interests" and "a singular focus" on domestic policies will impede international cooperation, which could lead to a "very dystopian scenario."

In order to avoid such an undesirable future, countries should jointly build a "new multilateralism," which means countries working together to improve living standards; governments and institutions becoming more transparent, accountable and inclusive; and when the economic benefits of globalization are shared by the many, not just the few, Lagarde said.

The IMF chief suggested world economies boost cooperation on four major areas: trade, international taxation, climate change and corruption.

Despite the "encouraging" progress at the Group of 20 (G20) summit in Argentina, the IMF chief urged countries to continue de-escalating trade tensions.

"This would include eliminating distortional subsidies," she said. "It would also mean protecting intellectual property rights without stifling innovation and getting rid of rents."

Lagarde encouraged countries to make 2019 the start of "Age of Ingenuity," with a future fueled by creativity and cooperation. "We must build on what worked, change what does not, and continually evolve, improve, and imagine a better future for all people."

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