Transcript

Transcript of a Press Briefing by Thomas C. Dawson, Director, External Relations Department, IMF

March 20, 2003

MR. DAWSON: Good morning, ladies and gentlemen. I'm Tom Dawson, Director of External Relations at the IMF, and this is another of our regular briefings.

As usual, we will be embargoed until approximately 15 minutes after conclusion, and we'll set a precise time at that point.

I don't have any formal announcements to make this morning. I'd like to remind everyone, though, about press registration for the Spring Meetings of the IMF and World Bank, which will be April 12th and 13th, the meetings, that is. Press registration has opened, as I indicated last time, and the deadline for sign-up is April the 9th.

I expect I will have another press briefing prior to the Spring Meetings, probably April the 3rd, so we can preview the agenda for the International Monetary and Financial Committee and the joint IMF-World Bank Development Committee.

The Media Relations Division will be circulating fairly soon details of embargoed press access to the Global Financial Stability Report, which we will issue on March 27th, and regarding the release of the World Economic Outlook, which will be published again in two parts on April 3rd and April 9th, respectively. If you have any questions regarding those reports, please contact Media Relations.

Now I will be happy to take your questions, of course, if you exercise the proper decorum by identifying yourself and your institutional affiliation.

QUESTION: With the outbreak of the war in Iraq, are there any thoughts that the Spring Meetings will be canceled, could be canceled? What would cause such a thing to happen? And do you have contingency plans for a virtual conference or anything like that?

MR. DAWSON: No, we are indeed planning to have the meetings, as I just indicated. If there were to be a change in that regard, we would, of course, let you know. But there's no indication of that at all at this point.

QUESTION: Just as a follow up, there's no concern on the IMF part with all the delegates here of any kind of safety issues? Are there contingency plans on that—in that regard?

MR. DAWSON: Well, we keep safety and security issues always under consideration, and at a time like this, for our staff as well as our Governors and delegates, that would be a matter of especial attention. And those are precisely the sorts of matters that we don't go into much detail with at a time like this, among other reasons because it is a little bit premature and prior to the meetings. But if there are security considerations that would affect you all, for example, in terms of access and so on, we certainly would be letting you know closer to the time.

QUESTION: The IMF, of course, follows market developments very closely. In the last 12 hours, have you seen any developments in the markets that would be cause for concern related to the outbreak of hostility?

MR. DAWSON: No, I think everyone is certainly keeping a close eye on it. You may have been literally walking in the door as it happened, but I note that the ECB issued a statement this morning indicating they were maintaining vigilance.

We, of course, with our mandate to work with our 184 members, are, of course, keeping an eye both on the global world economic outlook, and this is a particular time when we naturally would be looking at that, as well as on the impact on individual member countries. And that is our mandate; in past times of financial and other stress that has been our function; and we will continue to exercise that.

QUESTION: So nothing remarkable in the market reaction thus far?

MR. DAWSON: I'm not—I have no remarks.

QUESTION: How do you think the war in Iraq will affect Latin America and the expected recovery in the region?

MR. DAWSON: I'm sorry. Will affect?

QUESTION: Latin America.

MR. DAWSON: I think the concern of any impact is not focused on a particular region, so I don't think I would single out Latin America in that regard. I think it is important for all countries, whether they are program countries, whether in a particular region, to continue following the policy mix that minimizes vulnerability. And we are working closely with a number of the Latin American countries, but others as well, to support their policy framework. And I think there's on particular reason to focus, as I say, on Latin America.

I think if you'd like sort of a more extended view or description of our view, I would direct you to the Managing Director's speech in Spain a week ago—I'm trying to think—last Tuesday, I believe, or Wednesday—Wednesday at the central bank where he, in fact, was talking about the world economic outlook and the way forward for Latin America.

[Pause.]

MR. DAWSON: I may have to go take a walk around the block. If I go back to my meeting, people won't believe I actually came here.

QUESTION: I guess Ecuador is at the Board—is it on Friday? I may have forgotten.

MR. DAWSON: Yes.

QUESTION: But I'm not sure that we ever got a dollar number on what that loan was going to be? Can you sort of preview Friday's loan?

MR. DAWSON: I don't actually have the dollar number for you here. I know we can get it for you. It is—yes, the Board will discuss the program tomorrow, the 21st. The discussion was postponed by two days in order to allow the Directors the required amount of time to study the documents. So I think that's that, and we can get you the number. It's a matter of public record. I just don't have it here.

QUESTION: You've signaled yesterday in Argentina, some days before in Uruguay, that you were eager to see both countries do more to restructure its debt. Which are the steps that, according to you, these countries should take now regarding debt?

MR. DAWSON: I think in the case of Argentina, the need for the discussion with their creditors to work out between creditor and debtor—creditors and debtor is clearly something that any number of parties, governments, creditors, as well as the international institutions have indicated.

In the case of Uruguay, the authorities have started the process of consultation with bondholders on a debt exchange operation, and that's the way forward on that.

So I think I would just leave it at that in both cases. I think it's now a reasonably—the need is reasonably open, and so—and the two processes are hopefully going forward. But you're correct, they are important issues for both countries to be able to see the way forward.

QUESTION: Do you think that Argentina took too long to start the process?

MR. DAWSON: I mean, there is probably no aspect of the Argentine program that worked as quickly as any of us would have wanted to. I would not single out debt in that regard. It's been a difficult time, but I think things—as indicated by the Board discussion yesterday and the statement made by the Managing Director, significant progress has been made, and now we hope to be able to build on the progress. But I wouldn't single out delay in debt as a particular outlier in regard to the issues.

QUESTION: There is concern in markets regarding Turkey stemming from the reluctance of the U.S. to provide the aid that was in negotiation. Investors are showing concern that perhaps Turkey—some investors are showing concern that perhaps Turkey's debt isn't sustainable. What is your take on Turkey this time?

MR. DAWSON: Well, we certainly have been working closely with them. We've agreed on the key elements for the program. But details still need to be finalized and confirmed by the new government.

As we've indicated before, strict implementation of the program policies should go a long way toward mitigating the impact not only for regional conflict on the Turkish economy, but I would stress that with or without additional bilateral financing, strong policies are needed for Turkey to achieve its goals of debt reduction, disinflation, and rapid and sustained growth.

QUESTION: In his speech in Madrid, Mr. Kohler praised Brazil. Is Brazil the new best pupil of the IMF in Latin America?

MR. DAWSON: We have many outstanding pupils in Latin America.

That's it?

QUESTION: Following up then on Brazil. Brazil is seen as a country that's potentially quite vulnerable to a war, a prolonged war in the Middle East, because of its dependence on oil, on imported oil. What's your take? What kind of policy would you recommend to Brazil should the war be extended?

MR. DAWSON: Well, that's rather hypothetical, but I don't think I would also agree with you completely on your premise. I think the Brazilian Government, past and present, have done quite a bit, in fact, to reduce their vulnerability on the oil front. So I think that the government has a strong policy framework. They've shown their commitment to maintaining it. And so I think that the Brazilian authorities are, in fact, well positioned.

Okay. I think we're running out of questions, and I will lift the embargo at 10 o'clock. Thank you very much. Angela may have the answer for that question back here.

[Whereupon, the press briefing was concluded.]