Strong economic activity in the United States and emerging markets is expected to contribute to global growth of around 3% this year, according to the head of the International Monetary Fund. However, this forecast falls below the historical average, raising concerns about underperformance in the 2020s.
Kristalina Georgieva, managing director of the IMF, warned of a potentially disappointing decade if corrective measures are not taken. She pointed out that global economic activity remains weak compared to previous standards, and increasing debt levels pose significant challenges for public finances around the world.
Georgieva also noted that the consequences of the pandemic continue to affect economies, with a global output loss of around $3.3 trillion as of 2020. This has disproportionately affected vulnerable countries, further exacerbating economic inequalities.
Despite a modest growth projection of just above 3%, an improvement over last year, it is still below the historical average of 3.8%. The IMF attributes this increase in global growth to strong economic performance in the US and several emerging markets.
The IMF and World Bank will meet at their spring meetings in Washington next week, where key stakeholders will discuss pressing issues affecting the global economy. Among the concerns are ongoing conflicts such as the Russian invasion of Ukraine and the war between Hamas and Israel in Gaza, which threaten financial stability around the world.
