The International Monetary Fund (IMF) has said that the global economy is demonstrating remarkable resilience despite persistent uncertainty and geopolitical shifts.
IMF Managing Director, Kristalina Georgieva, stated this on Thursday in Washington during her presentation on the Global Policy Agenda at the ongoing Annual Meetings of the World Bank Group and the IMF.
Georgieva noted that while uncertainty has continued to rise across the world, the global economy has managed to stay afloat due to improved policy fundamentals and the adaptability of the private sector.
“Gold values too have shown resilience in the face of uncertainty and profound transformations in geopolitics, technology, trade relations, and demography,” she said.
According to her, two key factors explain the global economy’s steady performance.
“Firstly, improved policy fundamentals. Since the global financial crisis, many countries, especially emerging markets, have pursued sound policies. They have strengthened their institutions and frameworks — and that investment is now paying off.
“Secondly, the adaptability of the private sector, which has shown agility in import front-loading, supply chain strengthening, and navigating uncertainty,” she explained.
However, Georgieva cautioned that the medium-term outlook remains underwhelming.
“Public debt is near record highs and continues to climb. The global economy is excessively imbalanced, and forces of change are making it less predictable,” she said, adding that social discontent was rising as citizens demanded better opportunities.
She urged governments to unlock private sector growth to create jobs and improve livelihoods.
“For the private sector to thrive, countries must advance broad and ambitious domestic reforms,” she said. “I have encouraged our members to embrace a regulatory housecleaning to help foster innovation and entrepreneurship.”
On trade, Georgieva reaffirmed its role as a key engine of growth but stressed that it can only flourish under strong institutions, free and fair markets, and stable macroeconomic environments.
She called for renewed commitment to sound fiscal and monetary policies, advising countries to rebuild fiscal space, reduce debt, and rely more on domestic revenue sources.
“Countries must make smart budget choices,” she said. “On monetary and financial policies, the priority remains preserving stability and guarding against financial risks.”
The IMF chief also urged nations to reduce global economic imbalances.
“Countries with excessive surpluses, like China, should boost domestic demand, including by spending less on industrial policy and more on social safety nets. Those with excessive deficits, notably the United States, need to reduce fiscal deficits and incentivise private savings,” she said.
Highlighting ongoing IMF initiatives, Georgieva said the Fund was conducting a comprehensive review to strengthen surveillance, programme design, and debt sustainability frameworks, particularly for low-income countries.
She urged member countries to replenish the Catastrophic Containment and Relief Trust (CCRT), which was instrumental during the COVID-19 pandemic but is now depleted.
“Uncertainty is here to stay, and change is unstoppable. But with change comes opportunity,” she said.
Georgieva assured that the IMF would remain a steadfast partner to its members, helping them navigate global challenges and seize opportunities for growth and stability.
