7 March 2002
IMF COMMENDS UK ON IMPRESSIVE PERFORMANCE OF THE UK ECONOMY
The International Monetary Fund has ?commended? the UK Government ?for the impressive performance of the UK economy?.
According to the latest assessment by experts at the IMF, ?a strong policy framework, sound macroeconomic policies and sustained structural reform were key to this remarkable performance?.
At a discussion in Washington on 4 March, the IMF Board of Directors noted that the outlook for the UK economy is subject to risks, but agreed ?the current slowdown is likely to be relatively brief?. They judged the UK's economic policies to be appropriate in the present economic climate and noted that ?fiscal credibility earned from a strict adherence to a sound policy framework has greatly improved the UK's flexibility to respond to new challenges?.
The Directors welcomed ?plans to increase public investments in education and infrastructure? and ?recent measures to improve the efficiency and effectiveness of public services?, and endorsed the Government's objective of ?raising productivity through targeted reforms aimed at identifiable market failures?, including measures introduced to strengthen the competition regime.
Commenting on the IMF's report, the Chancellor, Gordon Brown, said:
?I welcome the IMF's endorsement of the Government's economic policy which provides clear support for the new framework for monetary and fiscal policy. Greater global instability means that we must not relax our fiscal disciplines and continue to work within the tough fiscal rules that we set out in 1997 and have stuck to throughout.
?I also welcome recognition of the importance of the Government's commitment to raising productivity, strengthening competition and to tackling low skills and child poverty.?
As in the previous two years, at the request of the UK Government the IMF is today publishing its Article IV staff report on the UK economy in full, along with the record of the IMF board discussion, and the UK's statement in the board meeting.
NOTES TO EDITORS
- IMF surveillance of every major economy is carried out primarily through annual consultations between Fund staff and member Governments and central banks, called Article IV consultations. The resulting reports are discussed at the IMF's Executive Board. The consultations for the UK's 2001 Article IV report took place from 27 November to 11 December 2001. The final report was based upon these discussions and finalized on 11 February 2002. The Acting Chairman's summing up, also published today, reports the Board's discussion of the UK economy on 4 March. As part of the Government's drive to increase transparency, domestically and internationally, the Treasury published the Concluding Statement of the IMF Mission just after the Mission team completed their work in December (HMT Press Release 139/01, 11 December 2001).
- To further enhance the transparency of the scrutiny process, at the request of the UK Government the IMF is today publishing the IMF's report in full, along with the IMF's Public Information Notice and the UK's statement to the IMF Executive Board which sets out the Government's response to the report. The IMF will also publish the selected issues papers by individual IMF staff; these are technical background papers for the Article IV report. These documents are available on the IMF's website.
- Enquiries on the IMF report should be addressed to Steve Field (020 7270 5196) in the Treasury Press Office.