UK finance minister to call for big economies to get borrowing under control at IMF

British Finance Minister John Healey is set to advocate for responsible borrowing and strengthened resilience against geopolitical disruptions when he convenes with world leaders at the IMF’s annual summit in Bangkok this week. Healey aims to collaborate with international partners to maintain trade flow, support citizens and businesses, and bolster Britain’s economy.

He believes major nations require comprehensive strategies to curb borrowing, echoing recent statements from IMF Chief Kristalina Georgieva and Bank of England Governor Andrew Bailey.

During the meetings, Healey plans to converse with Ukrainian Finance Minister Sergii Marchenko, among other officials, focusing on enhancing resilience. Recent data reveals that borrowing costs for leading economies have reached their highest levels in decades, fueled by apprehensions about soaring inflation resulting from the US-Iran conflict, extensive government borrowing, and the necessity for elevated interest rates.

Healey reiterated his commitment to implementing fiscal discipline during his inaugural budget on October 28, as he must enact measures to maintain plans for curbing borrowing amidst escalating debt interest expenses and a desire to allocate more funds to defense and energy cost reductions.

According to the Institute for Fiscal Studies, Healey may need £36 billion in tax hikes—comparable to raising the standard income tax rate by 3 percentage points—to fully counterbalance the erosion of government budgets due to heightened inflation and fund heightened defense spending.