IMF says Brexit will not cause global recession

(Baonghean.vn)- On July 7, International Monetary Fund (IMF) Managing Director Christine Lagarde said that Britain's decision to leave the European Union (EU) has caused significant instability for the world economy, but is unlikely to lead to a global recession.

In an exclusive interview with AFP, Ms. Lagarde said the Brexit issue has put the EU in a difficult position, as the EU must do everything possible to demonstrate how this long-standing alliance benefits Europe, in the context of increasing skepticism about this institution.

IMF Managing Director Christine Lagarde speaks at IMF headquarters in Washington on July 7, 2016. Photo: Bloomberg.

Ms Lagarde said Britain's move to cut corporation tax to counter the post-Brexit economic downturn was a "race to the bottom" that hurt everyone.

Although Ms Lagarde admitted Brexit was a "major risk" for the world, the event would only directly impact Britain and create a chain effect for the Eurozone.

However, she warned that the impacts and risks would be more serious if UK and EU policymakers did not soon come up with a clear framework and roadmap for Brexit.

The IMF chief stressed that "the sooner the timeline and terms of the exit are resolved, the better for everyone."

Two weeks after Britain's historic referendum, IMF Managing Director Christine Lagarde, who begins her second five-year term, is under pressure from significant turmoil in Europe.

However, she still expressed optimism that Brexit could be a "catalyst" to promote deeper economic integration of the EU./.

Lan Ha

(According to AFP)