The 2024 World Bank Group/International Monetary Fund Spring Meetings took place from April 15–20 in Washington, D.C. The Spring Meetings brought together central bankers, ministers of finance and development, parliamentarians, private sector executives, civil society organisations, and academics to discuss global economic concerns under the theme Vision to Impact.
I am very grateful to have had the opportunity to travel to Washington, D.C. and attend this conference. It was exciting to hear from a wide range of influential leaders, including Hana Brixi, World Bank Global Director for Gender; Gita Gopinath, IMF First Deputy Managing Director; Sri Mulyani, Minister of Finance for Indonesia; and Maarten Verwey, Directorate-General for Economic and Financial Affairs for the European Commission. I particularly enjoyed the Spring Meetings because the discussions were more academic and had greater emphasis on solution sharing than other conferences I’ve attended at the UN.
Below is a summary of the key themes observed throughout the conference.
Debt Crisis:
The current global context can be characterised by high debt, deficits, high interest rates, low growth, climate crisis, and conflict. Years of budget deficits have taken debt to historic levels. In 2023, only half of the world’s economies tightened fiscal policy, down from 70 percent in 2022. Consequently, global public debt reached 93 percent of global GDP, 9 percent higher than pre-pandemic levels. Debt burdens have a significant impact on the Global South as they limit the fiscal spending required to achieve the SDGs and mobilise financing for climate change.
How can we reduce the debt burden to promote sustainable development? Debt swaps were a popular solution to tackling the rising debt burden. This mechanism allows debt to be forgiven on the condition that the debt repayment amount is spent on development. This creates sufficient space for the Global South to tackle climate and social development challenges.
How do we finance climate change without increasing debt? Financing natural disasters creates further challenges for the Global South in meeting their debt obligations. One solution is parametric insurance, which offers pre-specified payouts in the event of a trigger event. This prevents countries from having to borrow when faced with a climate disaster. This suggestion launched a fiery debate over who pays for parametric insurance. Since the Global South are the smallest contributors to climate change and the most affected by its impact, they should not also be financially responsible for its consequences. An audience member used the analogy of a leaky toilet. She said, “If my neighbour’s toilet is leaking, why should I be expected to pay for it?”. This comment received a significant applause from the audience and highlighted the need for the Global North to contribute more to financing the impacts of climate change in the Global South.
How do we reshape our fiscal systems? A final area of discussion was the need to restructure the fiscal system. Maarten Verwey, Directorate-General for Economic and Financial Affairs for the European Commission, spoke about the importance of having fiscal rules that are simple, flexible, and guided by a risk-based approach. He mentioned three key improvements to the new fiscal system:
- Ownership: There is no ‘one size fits all’ approach to fiscal rules. They must be prepared by member states and tailored for each country.
- Fiscal consolidation: We must aim for fiscal consolidation but should give member states more time, conditional on strengthening institutions.
- Medium-term: Forecasts should be based on a four-year time horizon for realistic trajectories and a risk-based approach.
Sri Mulyani, Minister of Finance for Indonesia, spoke to the success of their fiscal rule, which caps deficits at 3% of GDP and accumulated debt at 60% of GDP. This 20-year rule has allowed Indonesia to sustainably manage debt even throughout the pandemic. She also stressed the importance of financial transparency so the public understands where tax revenue is being directed.
Gender Equality:
Discussions on gender equality were centered around gender-based violence and the need for economic reform.
Firstly, gender-based violence generates a huge cost to society. It is imperative that we invest in prevention and early response to gender-based violence. This requires social infrastructure for victims to have open conversations and trust that they are being listened to, opportunities for the public to speak up about policies so reform can be made quickly, and access to different services for victims. The private sector can also incorporate these strategies into their organisational infrastructure and invest in safe workplaces.
We must also recognise the unfortunate evidence that highlights a positive correlation between women’s economic empowerment and intimate partner violence. In our plight to empower women, we must be careful not to disempower men, for this risks polarisation and violence. We should therefore invest in education and services to combat men’s violence and promote positive male role models in society.
Secondly, our macroeconomic structures prevent women from achieving economic equality. We can observe increasing inequalities within and between countries, but we also need to assess how our macroeconomic structures drive inequality between genders. For example, does trade liberalisation actually benefit female-dominated industries? There is evidence to suggest that yes, it does, but evidence also shows that trade liberalisation reduces workers’ bargaining power, and since women already have low bargaining power, they lose even more.
Additionally, our industries are deeply segregated, contributing to a significant gender pay gap. The care sector is dominated by women at the individual, community, market, and public levels. This means women are responsible for the majority of care work at home, within schools and the wider community, in hospitals and aged care sectors, and at the policy level. The care industry is systematically undervalued and underpaid. We need to not only increase diversity in this sector but also recognise its true value to society.
We also need to address the fact that most of the highest-paying and most productive jobs are in male-dominated sectors. To ensure women have access to jobs where the pay is the highest, we need to assess gender equality in the types of education women pursue and promptly enact solutions that promote gender diversity across all industries.
Sustainable Solutions:
For successful development, we must ensure that our programs, policies, and institutions are built sustainably. This requires robust input factors and accountability processes.
Quantitative and qualitative input factors are necessary for the development of sustainable solutions. Data collection is vital to identify where the most pressing issues are and how best to address the problems at hand. Additionally, it is important to engage the people who will be impacted by the solutions under design. Women, youth, and people with diverse needs, are often excluded from the design and decision-making processes. Listening to their experience and expertise will support us in building long-term sustainable solutions.
Finally, for long-term sustainability, it is essential that we incorporate accountability into our processes and commitments. This requires setting objectives, measuring progress, and reflecting on outcomes. Here is a template and explanation from GFF and PIA on how civil society organisations can incorporate accountability into their work plans.
GFF Reporting Template Instructions
Author: Lauren Grant, Youth Representative
