The International Monetary Fund’s doubling of pledges to its defense fund to more than $430 billion last week is adequate to combat further threats from Europe’s debt crisis, said IMF First Deputy Managing Director David Lipton.
Countries now must turn from emergency steps to balancing budgets and building sustainable longer-term spending plans, Lipton said today in an interview on Bloomberg Radio’s “Bloomberg Surveillance” with Tom Keene and Ken Prewitt.
“The firewalls are very reasonably sized for the risks that we see out there and it’s time for everyone now to turn the focus to how to avoid ever needing to use them,” Lipton said of the financial defenses set up by the IMF and European governments.
“I don’t think there’s any firewall that can substitute for a good set of policies, countries grappling with their fiscal problems and establishing credible policies for the future,” he said.
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