IMF Chief: Global Economy Shows Resilience Amid Uncertainties

As the world continues to face various challenges, including short-term oil production cuts, the Israel-Gaza conflict, and tight monetary policies in the Middle East, it is no small feat that the global economy has remained resilient. According to Kristina Georgieva, managing director of the International Monetary Fund (IMF), growth in 2023 exceeded expectations despite these obstacles.

Georgieva spoke at the World Governments Summit in Dubai on February 11th and noted that while some economies have been negatively impacted by the Israel-Gaza conflict and subsequent rise in freight costs, as well as a nearly 50% drop in Red Sea transit volumes, the overall global economic situation has remained stable.

She also highlighted the challenge facing net energy importers as demand for oil continues to decline due to historically high debt and borrowing needs, limited access to external financing. However, Georgieva expressed optimism that growth in 2024 would surpass previous year’s growth rates. The IMF expects 2024 GDP growth for the Middle East and North Africa (MENA) region to reach 2.9%, down from 3.4% previously.

In order to promote sustainable economic growth and reduce pollution, Georgieva recommended gradual energy subsidy reforms for the Middle East region. By eliminating regressive subsidies, countries can save $336bn which is equivalent to the economies of Iraq and Libya combined. Georgieva believes that this move would encourage more responsible consumption habits and help improve social spending in these countries.

Overall, Georgieva’s comments reflect a cautiously optimistic outlook for the global economy despite ongoing challenges. While there are still many uncertainties ahead, it seems that with careful management and strategic interventions by policymakers around

By Editor

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