Washington, May 22 : Kristalina Georgieva, head of the International Monetary Fund (IMF), said that governments need to subsidise the cost of food and energy for the poorest members of society and without the Correct support, the protests seen in Sri Lanka could be repeated in other countries.
Speaking to the BBC, Georgieva said that such similar unrest before the Covid-19 pandemic, from France to Chile, was caused by “a sense of inequality growing” and decisions being made without the support of the people.
“If we are to learn any lessons from 2019 if is to be much more humble about policy decisions, and engage in multiple ways with people, because policies must be for people, not the paper we write them on,” she told the BBC.
The IMF chief said support needs to be provided “in a very targeted manner, preferably by providing subsidies directly to people”.
When it comes to the cost of living crisis, Georgieva told the BBC: “There are two priorities, one the very poor people, segments of society that are now struggling with high food and energy prices”.
The second, she added, is to support those businesses that have been “most damaged” by the war in Ukraine.
Georgieva is also concerned about the impact those higher borrowing costs will have on governments who have to repay huge debts they took on to get through the pandemic.
With that in mind she said governments needed to be “very careful” about how much money they spent and what they spent it on.
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