IMF calls for fiscal policies that tackle rising inequality

It warned that past experience shows these two factors can create strain and, with a sharp fall in asset prices, can spill over to the economy. HPR's Bill Dorman has more in today's Asia Minute.

In its half-yearly fiscal monitor, the International Monetary Fund (IMF) called for countries around the world to implement policies aimed at reducing inequality, and to seriously consider tax policies and transfers that would hopefully lead to a more even distribution of wealth without damaging growth potential.

The upward revision to the 2017 forecast reflects "the stronger-than-expected outturn in the first half of the year underpinned by previous policy easing and supply-side reforms", the IMF said.

High-level representatives of IMF and WB member-states, international financial institutes, representatives of the private sector and civil society will attend the meeting. Better prospects are also forecast for several other key regional economies - including South Korea, Hong Kong, Taiwan and Singapore.

Over the same 30 year period, the IMF said 53% of countries had seen an increase in income equality.

There are some cautionary notes.

IMF however said India is expected to regain the fastest growing major economy tag next year when it is forecast to grow 7.4 per cent, slower than earlier estimate of 7.7 per cent but higher than China's 6.5 per cent.

The IMF's Chief Economist did warn against complacency, noting that wage growth is still weak and not all countries are participating in the global recovery.