Mr. Min Zhu, Deputy Managing Director of the International Monetary Fund (IMF), pledged the institution’s continued support to small island developing states for their pursuit of sustainable economic development at the third United Nations International Conference on Small States Developing Country in Apia, Samoa on September 1-4.
Speaking at the High Level Partnership Dialogue on Sustainable Economic Development on the opening day of the conference, Mr. Zhu underscored the particular challenges faced by small states, including low growth, increased vulnerability to external shocks, and increasing debt burdens. He called for continued commitment from all stakeholders in helping the small states achieve sustainable economic development.
“Growth is critical for overall resilience and it should also be inclusive to be sustainable,” Mr. Zhu said. “The IMF stands ready to work with small states and all partners to help them overcome their development challenges and build a prosperous future.”
As the international financial institution tasked with assisting countries to develop and implement policies to achieve strong, stable, and sustainable growth, the IMF has intensified its engagement with small states in recent years and delivered its commitments on a wide range of issues, ranging from analytical work, policy advice, technical assistance to greater access to concessional lending for small states, he assured participants in the conference.
In addressing the problem of vulnerability to external shocks, policymakers in the small states face the challenge of building and maintaining appropriate levels of budget balances, public debt, and foreign reserves to sustain their economic growth. IMF experts work closely with governments through its economic monitoring and analytical work to help meet these challenges.
The IMF will continue to provide financial assistance to small states when needed, and 20 small states are eligible for concessional lending—with loans currently facing no interest rate charge as part of programs aimed at putting in place policies to address immediate and longer-term economic issues.
To help small states strengthen their capacity to devise and implement economic policies, the IMF is also providing technical assistance and training. Such capacity development is aligned with the Fund’s policy advice and financial support to facilitate economic reforms. This integrated approach is included in a set of recently issued guidelines on how the IMF can better serve and engage with small states, taking into consideration of their special economic circumstances.
The IMF hosted a breakfast meeting during the conference with a number of participating heads of states and governments as well as ministers, where they expressed their strong support to the Fund’s recent approach of providing pragmatic support to small states, and encouraged the Fund to continue and strengthen the partnership. The Fund also organized a side event on coping with natural disasters. Mr. Zhu joined a number of panel discussions, including those organized by the International Labor Organization and the World Bank, on economic integration, employment and debt management.