IMF head urges more global trade against econ. slowdown

By Ovunc Kutlu

NEW YORK (AA) - Countries should promote trade and end protectionism to fight a global economic slowdown, International Monetary Fund (IMF) head Christine Lagarde urged Wednesday.

"If we were to turn our backs on trade now, we would be choking off a key driver of growth," she said in a speech at Northwestern University Kellogg School of Management. "Restricting trade is a clear case of economic malpractice ... we must reverse the trend toward protectionism and restore a climate that supports a rebound in trade -- by completing multilateral trade agreements.”

Lagarde stressed that the global economic recovery has still been "weak and fragile", and economic growth has been "too low for too long, benefiting too few.

"Low productivity growth and high levels of debt could further depress investment and expectations of future demand," she warned, added that major economies like the U.S., Eurozone, China and India are struggling with slower growth.

Lagarde, however, noted that promoting trade is not enough. She emphasized that gains from global trade should be widely shared and those who are at risk of not benefitting from trade should be included and supported.

She listed public investment in education, more inclusion of women into the labor force, structural reforms, new macroeconomic policies, and especially cooperation and coordination among countries to boost benefits from trade.

"If all countries act decisively to stimulate their own growth, the positive spillovers reinforce each other. And as everyone is working to expand growth, everyone benefits from the efforts of others, to a much greater effect overall," she said.