Such a scenario would exacerbate uncertainty and hurt an already weakened global growth picture, Georgieva told reporters after a meeting of the IMF’s steering committee, where member countries voiced concerns about a host of risks facing the global economy.
This year’s annual meetings of the IMF and World Bank took place days after a fresh flare-up in a simmering trade war between the world’s two largest economies that dominated discussions among thousands of finance officials and central bankers from around the world.
The IMF on Tuesday forecast global real GDP growth at 3.2% for 2025, up from a July forecast of 3.0% and a more severe April forecast of 2.8%, saying tariff shocks and financial conditions had proven more benign than expected. That did not reflect the latest threats raised by the U.S. and China.
Georgieva said the IMF would keep a careful eye on developments, but noted that members were generally relieved that the global economy had proven more resilient than feared just six months ago. Countries were ready to “roll up their sleeves” to strengthen fundamentals, carry out regulatory reforms and tackle persistent global imbalances, although they remained deeply unsettled, she said.
“There is also still a sense of anxiety, because the performance of the world economy is less than we need it to be, and because there is a very dark cloud of uncertainty still holding lower our heads, and that uncertainty has become now the new normal.” Saudi Finance Minister Mohammed Al-Jadaan, who chairs the International Monetary and Financial Committee, said members engaged in a candid exchange of views despite their differences. “The mood was actually very positive, and there is an appreciation of the value that this committee and institution brings as a convening power to resolve problems that no one country can resolve on its own,” he said.
New Zealand Finance Minister Nicola Willis told Reuters that her country still saw real strength in the multilateral institutions and global trade rules.
“What’s come through, both in my bilateral meetings and the meetings with the IMF and World Bank, is that despite that uncertainty around the U.S. trade position, there is an ongoing commitment to multilateral organizations, to the free trade agreements that countries already have together, or as regions,” she said.
France’s new development minister, Eleonore Caroit, said the meetings showed continued support for financing development.
“I don’t want to be overly optimistic, because obviously we have clear differences of approach and of understanding with regards to climate, but I do believe that there is a way to work towards important changes that are needed,” she said.
TRADE TENSIONS, GLOBAL IMBALANCES AMONG CONCERNS
Al-Jadaan issued a chair’s statement – not a communique that would have required consensus – that reflected concerns about growing trade tensions, advances in artificial intelligence and shifts in global markets, while holding out hope for resilient growth and continued disinflation.
The statement from the IMFC, which represents the crisis lender’s 191 member economies, also flagged downside risks from low economic growth, high debt, extreme weather events, excessive global imbalances and wars.
“Major policy shifts in trade and other areas are reconfiguring global markets and policy frameworks, heightening uncertainty,” it said.
“These changes, as well as transformative forces such as digitalization and demographic shifts, bring challenges but also opportunities.”
The statement predicted continued disinflation, but with variations across countries. IMF executives this week noted that countries imposing tariffs, such as the U.S., faced potentially higher inflation for longer, while some Asian economies such as China risked deflation.
The statement also stressed the need for independent central banks to maintain policy credibility.
“Central banks remain strongly committed to maintaining price stability, in line with their respective mandates, and will continue to adjust their policies in a data-dependent and well-communicated manner,” the statement said.
It also called for tackling financial vulnerabilities and risks by “strengthening surveillance of systemic risks stemming from AI, non-bank financial institutions and digital assets, while harnessing the benefits of financial and technological innovation.”
