The IMF alarm: "World economy uncertain between energy shock and AI. Action on debt is needed"

MILAN – When the meeting of the 191 member countries of the International Monetary Fund opens next week, those responsible will have to "assess the performance of the world economy in a phase characterized by strong uncertainty and rapid changes". IMF Director General Kristalina Georgieva explains this in a speech in Singapore on the eve of the organization's annual summit.

"The global economy - explains the Bulgarian economist - is subject to two opposing forces: a negative energy supply shock and a positive demand shock resulting from artificial intelligence (AI). The combined impact of these two forces is extremely uneven at a global level".

Anticipating the indications that will be contained in the next World Economic Outlook, Georgieva observes that the hardest blows to growth this year concern the economies devastated by the war" even if the repercussions are "also observed in other vulnerable countries, namely those dependent on energy imports and without sufficient room for maneuver to cushion the shocks".

Georgieva also focused on the issue of the high public debt of many countries, reporting the lack of "decisive actions" in highly indebted advanced economies, pointing to several Eurozone countries and urging "very difficult political choices" to restore public finances. "We do not see decisive action in highly indebted advanced economies, while it is urgent to adopt credible medium-term fiscal consolidation plans. We are faced with very difficult political choices", reiterated Georgieva in Singapore on the eve of the annual meetings of the IMF and the World Bank. "The growing burden of public debt fuels inflation and will not be reduced only thanks to growth", she observed.