(Adds comments from news conference)
By David Lawder
WASHINGTON, April 20 International Monetary Fund
Managing Director Christine Lagarde said on Thursday she
believes the IMF can work with the Trump administration to
improve the global trading system, but cautioned against
jeopardizing open trade as a growth engine.
Lagarde told a news conference at the opening of the IMF and
World Bank spring meetings in Washington that the IMF saw the
need to reduce subsidies and other trade distortions that limit
competition, but also said "protectionist measures" needed to be
"From the various contacts that I've had with the
administration so far, I have every reason to believe that we
will make progress, that we will cooperate all together in order
to support and indeed improve the system as we have it," Lagarde
She added that improvements must ensure a "level playing
field" for trade, adopting a phrase often used by Trump
But as she was speaking, U.S. President Donald Trump was
preparing to sign an executive order to study whether steel
imports into the United States could be restricted for national
security reasons under a law passed in 1962.
Lagarde said that the rising number of World Trade
Organization dispute cases and rule violations showed that
"there is clearly an issue that needs to be addressed."
She said the WTO dispute settlement system has room for
improvement. Although the United States regularly uses the
system to try to remove unfair trade restrictions and subsides,
Trump administration officials have complained that countries
often ignore its rulings.
But the IMF chief said that such improvements can only come
through multilateral dialogues, like those occurring at this
week's meetings of the IMF, World Bank and G20 finance
"We believe very firmly in this institution, in the value
and virtues of dialogue, cooperation, reciprocated assessment,"
she said. "We will contribute our part where we have competence
and where it is our mission."
The Trump administration has complained about Germany's high
trade surplus with the United States. Lagarde repeated her view
that Germany should take steps to reduce its current account and
trade surpluses by encouraging more consumption.
(Reporting by David Lawder; Editing by Paul Simao)