An Indian- American economist born in Mysore, Gita Gopinath recently joined the International Monetary Fund (IMF) as its chief economist, becoming the first woman to occupy the top IMF post.

Gopinath, 47, is the John Zwaanstra Professor of International Studies and Economics at Harvard University and she succeeds Maurice Obstfeld as the Economic Counsellor and Director of the IMF’s Research Department.

Gopinath was appointed on October 1 as the chief economist and the IMF Managing Director Christine Lagarde described her as one of the world’s outstanding economists with impeccable academic credentials, a proven track record of intellectual leadership and extensive international experience.

Gopinath is the 11^th chief economist of the IMF and in an interview with The Harvard Gazette she described her appointment as a tremendous honour and she would like the IMF to continue to be a place that provides intellectual leadership on important policy questions.

Talking about the work she would like to focus on, Gopinath shared, “Among the research issues that I would like to push, one would be understanding the role of dominant currencies like the dollar in international trade and finance. We could do more on the empirical side to try to understand countries’ dollar exposures and on the theoretical side in terms of the implications for international spillovers, consequences of dollar shortages, etc. Most countries invoice their trade in dollars and borrow internationally in dollars. This is a central part of the international price system and the international financial system and it will be exciting to explore its consequences in greater depth with the IMF.”

The biggest issue being faced by the IMF is, “That we are seeing the first serious retreat from globalization. This has not happened in the past 50 or 60 years when the world moved towards lower tariffs and increasing trade across countries,” she told the prestigious Harvard publication.

“Over the past several months, we have the US-imposed tariffs and retaliation to them from China and other nations. There is in general growing uncertainty about trade policy, including the one arising out of Brexit (the British move to leave the European Union).”

Adding to this, she said, “While the trade has reduced global poverty and raise livelihoods, its consequences for inequality, and on whether the rules of engagement are fair, are real concerns that need to be addressed.”

In regards to the fairness in trade, Gopinath shared that there is a concern about whether there is right multilateral institutions and frameworks in place to make sure everybody feels that there is fairness in trade. And the same goes for capital flows.

“Foreign direct investments (FDI) was always viewed very favourably by countries. But because of the FDI is not in tech-heavy firms, there are growing concerns about national security and international property theft. So I believe this retreat from globalization and this retreat from multilateralism is quite unique to the times we are living in.”

Another important concern, she says, is the health of emerging markets as the US continues to normalize its interest rates. “The capital flows to several markets have reversed, putting pressure on their exchange rates and consequently on inflation, and on balance sheets, given that several emerging markets borrow heavily in dollars,” she said.

H/T: The Quint