Nigeria's Economic Growth Too Slow To Reduce Poverty, Says IMF

World Bank Group President David Malpass to visit India and Pakistan in October

World Bank Group President David Malpass to visit India and Pakistan in October

The deal is a compromise with the USA, the Fund's largest shareholder, which has resisted changes to the organisation's voting structure as well as increases in its permanent resource base.

New IMF managing director Kristalina Georgieva on Thursday said that a trade truce between the United States and China could trim expected losses to the world economy, but would not be enough to produce strong global growth.

U.S. Treasury Secretary Steven Mnuchin, who holds an effective veto over major Fund decisions, endorsed the move, which calls for a doubling of the IMF's crisis lending fund to about $500 billion, restoring it to levels during the 2008-09 financial crisis.

The IMF's bylaws drafted at the end of World War Two require the Fund to be headquartered in the world's largest economy - which may require a shift in coming decades based on forecasts that China's GDP will eventually exceed that of the United States.

She said the global body had understood how important Nigeria is to the economy of Africa, adding that this was why it had consistently advised the need for a major improvement in the fiscal space particularly in relation to revenue, economic diversification and corruption. That would be the weakest showing since a negative 0.1% in 2009, in the wake of the worst financial crisis since the 1930s.

In her remarks, Georgieva, a Bulgarian economist who had been the No. 2 official at the World Bank, recognized the accomplishments of her International Monetary Fund predecessor, Christine Lagarde, the first woman to head the International Monetary Fund, who was in the audience for the speech.

In her news conference Thursday, she said she hoped this week's talks would focus on ways to ease trade tensions and begin the groundwork to update the rules of world trade.

The administration of US President Donald Trump has repeatedly attacked the Geneva-based WTO, saying that it is biased against the US.

"We are preparing a foundation for future growth through fairer trade deals", Mnuchin said in remarks Saturday to the policy-setting committee of the International Monetary Fund.

World Bank President David Malpass said the slowdown in global growth was hurting efforts to help the 700 million people around the globe mired in extreme poverty, especially in nations trying to cope with a flood of refugees from regional conflicts.

Georgieva said that commerce has been transformed by advances in technology and they need to be acknowledged in new trade rules.

In his announcement last week, Trump said he was suspending a tariff increase on $250 billion of Chinese products that had been scheduled to take effect this week.

"Global growth is slowing, investment is sluggish, manufacturing activity is soft and trade is weakening", he said. He said the European Union was ready to negotiate a settlement to avoid the tariffs but so far the USA has rejected those efforts.

Although it will take several weeks to write up the terms of the deal, the full scope of which has not yet been announced, Trump said that he and his Chinese counterpart, Xi Jinping, would sign the agreement during the November 16-17 Asia-Pacific Economic Cooperation summit in Chile.

Mnuchin said the administration has made no decision yet on whether it will postpone 15% tariffs on $160 billion in Chinese goods still due to take effect December 15.

Latest News