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| Tuesday, 18 January 2005 |
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Economic reform can help face unexpected disasters - Ms Krueger First Deputy Managing Director, International Monetary Fund (IMF), Anne O. Krueger said that the economic reform process can increase the resources available to countries helping governments and their citizens to cope more successfully with the aftermath of natural disasters. Ms. Krueger was addressing a public lecture of the National Council of Applied Economic Research (NCAER) in New Delhi, India last week. She is scheduled to arrive in Sri Lanka today to assess the scale of the challenges the country has to face following the tsunami. "Economic reforms enable countries to achieve higher growth rates than would otherwise be possible. This reduces poverty and so reduce the number of those most vulnerable to natural disasters. It will also reducing vulnerability to the economic or financial turbulence that can follow such events that inevitably occurs from time to time," Krueger said. She said where economic reforms have been undertaken, economic growth has been more rapid, and rapid growth is the only effective way to enable countries to adapt better in the face of unexpected and unpredictable shocks. "It is important to seize opportunities for locking in progress, pressing ahead with economic reforms when there is a chance. That will also help increasing the flexibility-and thus the adaptability-of economies when sharp changes do occur," Krueger said. She said the IMF is still trying to assess the scale of the destruction left by the tsunami that struck many parts of Asia on December 26. "The IMF, like other international agencies, has from the start stood ready to help. We will assist with macroeconomic assessments of the impact and by helping to maintain macroeconomic stability where appropriate. The Fund is not a frontline relief agency: but we do have a lending facility for countries affected by natural disasters," Krueger said. She also emphasized the need for an early warning system that should be established as rapidly as possible, to help limit the damage from tsunamis. |
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