Yellen Warns Against Withdrawing Economic Support Too Quickly

The United States Treasury Secretary, Janet Yellen, said on Tuesday that a strong economic recovery in the U.S. would help overall global growth, Reuters reported.

More work is needed to deal with the vulnerabilities that the pandemic has shown, especially in the non-banking financial sector, as well as the global supply chains, and the social safety nets.

Yellen’s remarks during the spring meetings of the International Monetary Fund (IMF) and World Bank, came in line with recent forecasts by the IMF, which said that the global economy could achieve its best growth rate this year since 1976.

She reiterated the determination of the Joe Biden administration to go big in terms of spending to cope with the impacts of the pandemic.

Yellen said that the world must learn the lesson from the 2008 global financial crisis, which is not to withdraw support too quickly.

It is worth noting that it previous estimates showed that limited spending after the crisis slowed recovery by four to five years.

“We would encourage all those developed countries that have the capacity to continue to support a global recovery for the sake of the growth in the entire global economy.”

Speaking about climate change, Yellen pointed to the U-turn that the Biden administration is taking in dealing with the issue on the international stage.

“Climate, by its very nature, requires strong global cooperation.”

“We lost four important years, and we recognize that many of you around the room have been leading change in your own countries.”