Global economy doing better than feared, but worse than needed: IMF MD

The global economy remains resilient in the face of multiple shocks, according to International Monetary Fund (IMF) managing director Kristalina Georgieva, who recently told the G20 Leaders’ Summit in Johannesburg that stubbornly low growth, high debt and rising uncertainty continue to hold back many countries, especially the poorest.

“My headline message today is very straightforward. The global economy is doing better than we feared, but worse than we need,” she said.

The global economy is resilient amid multiple shocks, IMF MD Kristalina Georgieva recently said.
Stubbornly low growth, high debt and rising uncertainty continue to hold back countries, especially the poorest, she noted.
“The global economy is doing better than we feared, but worse than we need,” she told the G20 Leaders’ Summit.
But it remains below pre-COVID levels, while debt is ‘exceptionally high’.

She said resilience has been driven by a strong private sector and years of strengthened policies and institutions, including cooperation within the G20.

But global growth remains below pre-pandemic levels, while debt is ‘exceptionally high’, leaving many developing and low-income countries unable to invest in essential services and climate resilience.

Urging governments to reinforce confidence through credible and predictable policies, restore buffers and tackle domestic imbalances that feed broader global vulnerabilities. Structural reforms will also be essential to unlock private-sector potential, she said.

There is a need to modernise trade rules for the digital economy and mobilise new financing for countries in need.

The IMF is expanding its permanent quota resources by 50 per cent, a decision supported by G20 members, she said.

Though advances in artificial intelligence (AI) could boost global growth by nearly 1 per cent, she cautioned that AI’s impact will be uneven, with up to 60 per cent of jobs in advanced economies potentially affected. She called for urgent investment in digital infrastructure, skills, flexible labour markets and ethical regulation.

Geopolitical tensions, technological and demographic transformations, and frequent severe climate events are contributing to heightened uncertainty and pushing risks up, she added.

Fibre2Fashion News Desk (DS)