ITUC tells IFI meetings to abandon austerity, focus on job-centred recovery

In meetings held with officials gathering in Tokyo for this weekend’s annual meetings of the International Monetary Fund and World Bank, ITUC General Secretary Sharan Burrow urged governments and the international financial institutions (IFIs) to end the disastrous austerity policies which have driven the global economy into a new downturn, and instead to support a jobs- and income-led recovery strategy.

Burrow noted that the IMF’s chief economist revealed in a report released on Tuesday that the Fund’s economic projections had underestimated the recessionary impact of austerity policies applied by many governments since 2010, as a result of which ten European countries have entered into a “double-dip” recession in 2012.

Said Burrow: “The IMF report confirms warnings that unions have made to the IFIs and the G20 G20 The Group of Twenty, or G20, is a forum for international cooperation on the most important aspects of the international economic and financial agenda. It brings together 19 countries and the European Union, which together represent around 90% of global GDP, 80% of global trade and two thirds of the world’s population. for the past two years that premature fiscal consolidation would produce a renewed global slowdown. It is high time that governments reverse course and support green investments, funding of quality public services such as health and education and other employment creation initiatives.”

Burrow also encouraged the IFIs to move forward in their commitments to support the establishment of social protection floors and to pay greater attention to the employment impact of their policies. She stated that they should also take steps to establish adequate regulation of the private financial sector so as to avoid recurrence of financial crises and instead ensure that the financial sector supports recovery by providing sufficient credit to real economy investments.

In light of recent decisions by several governments to put in place financial transactions taxes (FTT), Burrow said: “The IMF should offer its technical assistance for the coordinated implementation in as many countries as possible.” The ITUC has supported the FTT as a means to finance job-intensive recovery projects and public services, development goals and climate-finance commitments.

The ITUC and Global Unions produced a statement containing their detailed proposals which they presented to the IFIs at the occasion of their annual meetings.

See Global Unions’ statement to the annual meetings of the IMF and World Bank (Tokyo, 12-14 October 2012)

See Sharan Burrow’s opinion piece