European countries needing to implement reforms to jolt their tepid economies must capitalize on a "rare" opportunity of cheap oil and low interest rates, International Monetary Fund chief Christine Lagarde said Thursday.
The drop in oil prices has increased buying power in Europe's oil-importing countries, cheap money is helping governments refinance debt, and the European Central Bank last month launched an injection of 1.1 trillion euros into bond markets in a so-called quantitative easing policy to spur private investment, German Press Agency dpa reported.
"I think that the eurozone has the benefit of three shots in the arm, actually," Lagarde said after a speech at the Atlantic Council in Washington.
"With these three factors, if European countries don't do economic reforms now, it's to despair." Current conditions present "a window of opportunities when countries that have not yet conducted the reforms, that have started conducting the reforms, have to actually get on with it, because they have the benefit of low oil prices, very low cost of financing ... and the quantitative easing that is intended to really support and kickstart the economy." In the address, which precedes the IMF's spring meetings next week in Washington, Lagarde urged efficient infrastructure investments to raise productivity, along with reforms in labour, product and services markets.
The eurozone "has strengthened" in the last three years, she noted.