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Lagarde: No World Recession after Brexit - ASHARQ AL-AWSAT English Archive
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London, Washington-International Monetary Fund Chief Christine Lagarde said that Britain’s vote to quit the European Union is unlikely to cause a world recession.

In an interview with Agence France Presse (AFP), Lagarde said Brexit is one of the main current risks, adding that immediate effects would hurt the UK, with some spillover to the euro area.

“The longer the process for Britain’s withdrawal remains unclear, the worse the effects could be”, Lagarde added. “The key word about this Brexit affair is uncertainty and the longer the uncertainty, the higher the risk,” she continued.

“The sooner the British people can resolve their timeline and the terms of their departure the better for all. It needs to be predictable as soon as possible”, said Lagarde.

Despite the uncertain economic situation, IMF chief expressed optimism as Brexit might motivate the European Union countries to reinforce the EU economy integration.

Lagarde, who was France Minister of Finance in 2007-2011, asked the EU for more trasnperacny towards citizens and less putting the blame on Brussels for all the failures.

From his part, Mohammed El-Aryan, the Chief economist at ALLIANZ, warned of a possible drop of pound sterling value unless a confidential alternative plan was reached in regards to a free trade agreement.

El-Aryan saw high risks of Britain slipping into an economic recession following the vote results. “After Brexit, UK should take quick political steps including appointing a new prime minister capable of negotiating with the EU”, he told Reuters.

Chief Economist said that the future value of the pound sterling depends on how quick uncertainty in the economic structure is resolved; any delay in the alternative plan will lead to unpleasant consequences.

Asharq Al-Awsat

Asharq Al-Awsat

Asharq Al-Awsat is the world’s premier pan-Arab daily newspaper, printed simultaneously each day on four continents in 14 cities. Launched in London in 1978, Asharq Al-Awsat has established itself as the decisive publication on pan-Arab and international affairs, offering its readers in-depth analysis and exclusive editorials, as well as the most comprehensive coverage of the entire Arab world.

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