Kristalina Georgieva, the head of the International Monetary Fund (IMF), expressed hope that the U. S. and China would reduce trade tensions to prevent disruptions in the supply of rare earths, which could significantly impact global economic growth. She indicated that any cutoff in this supply would worsen uncertainty and negatively affect an already fragile global economy. Georgieva spoke after an IMF steering committee meeting where member countries discussed various risks to global growth.
During the annual meetings of the IMF and World Bank, the ongoing trade conflict between the U. S. and China was a major topic among finance officials from around the world. The IMF projected global real GDP growth at 3.2% for 2025, an increase from previous forecasts, which reflected an unexpected stability in tariffs and financial conditions. However, this outlook did not take into account the recent threats from the two nations.
While noting that the global economy showed greater resilience than anticipated, Georgieva mentioned that there remained a sense of anxiety due to underwhelming economic performance and persistent uncertainty. Saudi Finance Minister Mohammed Al-Jadaan, who chaired the meeting, reported a positive atmosphere among members, emphasizing the usefulness of the committee’s role in problem-solving.
New Zealand’s Finance Minister, Nicola Willis, reaffirmed the strength of multilateral institutions and global trade rules despite uncertainties with U. S. trade policies. France’s new development minister, Eleonore Caroit, acknowledged existing differences related to climate issues but expressed hope for collaboration towards necessary changes.
Al-Jadaan released a chair’s statement highlighting concerns about trade tensions, developments in artificial intelligence, and changing global markets while maintaining a hopeful outlook for growth and disinflation. The statement identified risks linked to economic stagnation, high debt, climate events, and conflicts. It urged for independent central banks to uphold policy credibility and called for increased monitoring of financial risks associated with emerging technologies and digital assets.
With information from Reuters