International Monetary Fund chief Christine Lagarde urged Britain and the European Union yesterday to keep communications open to avoid the failure of a “long marriage” with the Brexit vote.
“It’s been a long marriage between members of the European Union,” she said.
“It’s really my personal hope that it doesn’t break. Like all marriages, good talks can actually help and I hope that the dialogue can continue.”
Speaking at the opening of the spring meetings of the World Bank and IMF, she called the risk that Britain would decide to pull out of the 28-nation European Union – “Brexit” – a “serious concern” to the global economy.
She warned of continuing market fragility as the June 23 referendum on pulling out nears. “Whatever happens, I think that all parties should rise above the domestic circle and should have a broader view of what lays ahead in terms of collective endeavour.”
“Because keeping Europe together after what it has gone through over the last century, and what the risks are on the horizon.... is actually a huge asset which is vastly underrated in my view.”
In its assessment of the state of the world economy released earlier this week, the IMF called Brexit a leading risk to growth and warned that it “could do severe regional and global damage by disrupting established trading relationships.”
Meanwhile, Finland’s eurosceptic foreign minister yesterday said he hoped Britain will remain in the European Union and that a British decision to leave would be a “catastrophe for Europe.”
A Brexit would have negative consequences on Europe because Britain has the second largest economy in the EU after Germany and “Britons are the second most important net payers in the EU,” Finnish Foreign Minister Timo Soini told reporters in Helsinki.
Britons are set to vote in a crucial referendum on June 23 to decide whether to support a so-called Brexit, or exit from the EU. The latest polls show the decision could go either way.
“It would indeed be a catastrophe for Europe and a difficult situation for Finland if they do leave,” the Finnish foreign minister said,
Soini, leader of the populist Finns Party, has in the past been a fierce critic of the EU and called for a similar referendum in Finland on leaving the bloc.
But he was forced to tone down his criticism after he became foreign minister nearly a year ago. “I do give (British Prime Minister David) Cameron credit for allowing the people to decide,” Soini said, adding that he was afraid of a chain reaction of EU exits in other countries, such as Denmark and the Netherlands. Finland’s parliament is set to debate holding a possible referendum on leaving the EU single currency, the euro, after receiving a petition signed by more than 50,000 citizens in March.
Soini’s Finns Party has seen its voter support nearly halved over the past year, as Finland struggles with an economic recession and the biggest migration crisis in Europe since World War II.
IMF managing director Christine Lagarde (centre) speaks as first deputy managing director David Lipton (left) and communications director Gerry Rice listen during a news conference yesterday in Washington. Lagarde warned that Brexit is a leading risk to growth and it could do severe regional and global damage by disrupting established trading relationships.
