IMF: Europe needs to take decisive action now on banking crisis
The International Monetary Fund (IMF) has issued its starkest warning to date that Europe’s banking debacle is turning into a systemic threat to global finance and can no longer be allowed to fester.
By Ambrose Evans-Pritchard
“This is the most urgent crisis facing the world today,” said Zhu Min, the IMF’s deputy managing director and China’s voice at the institution.
“There is no room for politicians to muddle through: they have to take decisive action today. Banks must be recapitalised and made solvent,” he said at the World Economic Forum in Dalian.
The IMF has ruffled feathers in Europe by calling on the region’s banks to raise €200bn (£174bn) in fresh capital, with partial nationalisation and by compulsion if necessary, but events are fast vindicating the Fund.