Fireside Chat, Interview
A Conversation with IMF Managing Director Kristalina Georgieva | Global Conference 2025
- Global economic resilience is projected to persist despite extraordinary disruptions, though growth forecasts for the current year are downgraded from 3.3% to 2.8% with no recession anticipated.
- Global trade is expected to undergo significant turbulence and transition to a new equilibrium characterized by highly uncertain pathways, with a non-trivial transition cost.
- Advanced economies face a dual risk of weak growth combined with potentially accelerating inflation driven by supply constraints and persistent demand in the United States, while inflation expectations may decline in demand-shocked regions like the European Union.
- China is projected to experience deflation due to severe demand shocks, with an economic shift expected toward domestic consumption, a resolved property sector, reduced state involvement in non-strategic areas, and a greater emphasis on services.
- Policymakers are expected to engage in intensified activity regarding trade relations following spring meetings, leading to an emergence of bilateral and plurilateral agreements and the implementation of postponed regional reforms in ASEAN and the Gulf Cooperation Council.
- U.S. fiscal dynamics include a deficit estimated at approximately 7% for the year, with a potential further increase driven by anticipated tax cuts, creating a backdrop where the administration pursues a radical departure from two decades of economic policy.
- Investor and consumer confidence are contingent upon the reduction of uncertainty and the restoration of predictability, as continued volatility may trigger a cessation of investment and consumption.
- Emerging markets are not anticipated to suffer major impacts from recent financial volatility, with specific focus placed on Argentina's expected success in lowering inflation and achieving a surplus.
- Policy focus in major advanced economies is shifting toward stimulating faster growth through regulatory improvements and innovation rather than increased borrowing.
- The transition to a new trade equilibrium is viewed as driven by underlying structural shifts rather than isolated events, with Germany expected to continue reforming its debt brake to expand economic capacity.