The IMF has openly criticized the costly economic support plan announced by the United Kingdom on Friday, going so far as to ask London to “reassess” its measures at a time when the country is going through a serious economic crisis against a backdrop of soaring food prices. energy.
This plan, the financing of which is still very unclear, provides for a freeze in the cost of energy for individuals and businesses, but also significant tax cuts, the announcement of which has led in recent days to a plunge in the pound and a surge in borrowing rates in the country.
The sharp tax cuts planned by British leaders are likely to increase inequality, worries the International Monetary Fund in a statement sent to AFP on Wednesday.
The Washington institution even goes so far as to ask London to reassess these measures when it presents its budget on November 23, especially those that benefit people with the highest incomes, in this statement with an unusually direct tone for the institution. international.
The energy price freeze, which alone should cost 60 billion pounds for the first six months, is also at the center of criticism of the Fund, which recalls that it does not recommend broad and untargeted budgetary packages at this stage.
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It is important that fiscal policy does not run counter to monetary policy, the IMF also writes as the Bank of England tries to slow economic activity through rate hikes in order to fight against a surge. of inflation.
We understand that the major budget plan announced aims to help families and businesses cope with the energy shock and boost growth through tax cuts, however, underlines the IMF, about the plan presented by the Chancellor of the Exchequer (Finance Minister) Kwasi Kwarteng, saying he is watching the situation in the UK carefully.