IMF Director: Danger indicators for the global economy despite its improvement

She said General Manager International Monetary Fund Kristalina Georgieva The The global economy is better off than feared, but it is not enough.
In her introductory speech to the annual meetings of the International Monetary Fund and the World Bank scheduled for next week, she stressed that the global economy has generally withstood severe tensions, and that it is better off than feared, but worse off than it should be."
Global growth is lower than hoped.
Global growth is expected to reach about 3% in the medium term, which is in line with prevailing rates over the past years, but it is lower than the 3.7% that prevailed before the Covid-19 pandemic as an annual rate, according to what Georgieva said, quoting data from the Fund’s new annual report on the state of the world economy that is being issued. Tuesday.
The Director General of the Fund stated that last April, many experts, who were not among them, expected a short-term recession in the United States that would have negative repercussions on the rest of the world, but the American economy has held up, like several advanced and emerging economies.
US customs duties
Among the factors that prevented the deterioration The situation is that US customs duties are lower than expected in the end, even if the United States becomes one of the countries that imposes the highest rates of tariffs on products imported into its territory, in addition to favorable financial conditions for economic activity, a private sector that is easy to adapt and solid political foundations.
Despite the economy’s resilience in the face of turmoil, warning indicators have begun to follow, starting with the rise in global demand for gold, and the danger of High inflation due to customs duties, according to Georgieva.
Rising global debt
The director of the International Monetary Fund expressed her fear that the confidence of the financial circles would suddenly change, which could deprive companies of the necessary financing.
Also, she warned of the risk of a severe correction in the prices traded on the stock exchange for companies related to the development of artificial intelligence that Its capitalization appears to be heading to levels not seen 25 years ago during the Internet bubble.
In light of these risks, Kristalina Georgieva called on countries to preserve global trade as the engine of growth while investing in promoting growth in a sustainable manner based on informed decisions.
Also, she called on countries to put their internal affairs in order, especially by re-adopting margins in budgets. It allows facing future shocks, while putting an end to excessive imbalances such as excessive consumption in the United States and very high investments in China.
The path of global public debt continues to rise, and may reach 100% of global GDP by 2029, driven especially by the United States, China and European countries, and in light of the contraction of bond markets and the sharp rise in loan ratios in Countries such as Japan, France and Britain.
Pressures on borrowing costs
Georgieva warned of repercussions that may include higher interest rates and increased pressures on borrowing costs that affect other expenditures and limit governments’ abilities to confront shocks.
She stressed the need to adjust budgets, in rich and poor countries. Both, while acknowledging the difficulty of the matter, as demonstrated by the numerous cases that witnessed social tensions, but if things are done in a controlled and well-organized manner with adequate information, it is possible to reduce the deficit significantly.
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