At the spring meetings of the International Monetary Fund and World Bank earlier this month, the world’s finance ministers and central bankers congratulated each other on progress in curbing inflation and reviving post-pandemic economic growth. But they also acknowledged an excess of unfinished work — in particular, on improving financial stability, restoring fiscal discipline and fighting climate change.
Governments need to see that these tasks, each vital in its own right, are linked. Fiscal control is essential for financial stability, and better carbon-abatement policies can strengthen fiscal control. In a year of multiple elections, with more weight than usual given to empty promises and short-term calculations, getting this right won’t be easy. But the fact remains: These problems will most likely be solved together or not at all.