By zainab.joaque@awokonewspapersl.com
Washington, D.C. – The global economy is facing a critical juncture, and the time to act is now, according to International Monetary Fund (IMF) Managing Director Kristalina Georgieva. Addressing the world’s economic media during the IMF-World Bank 2025 Spring Meetings in Washington, Georgieva issued a stark warning: the combination of slowing growth, persistent inflation, and geopolitical trade tensions is straining economies across the globe — and indecision is only making matters worse.
“Uncertainty is the enemy of growth,” she declared during the unveiling of the IMF’s Global Policy Agenda. “When businesses pull back on investment and households tighten their belts, it further dampens already weak growth prospects.”
Indeed, the IMF’s latest World Economic Outlook paints a subdued picture. Global growth is projected at just 3.3% for 2025 and 2026 — well below historical averages. The Organisation for Economic Co-operation and Development (OECD) and World Bank offer similar forecasts, pointing to lingering inflation and unstable policy environments as major roadblocks to recovery.
At the heart of Georgieva’s message was a plea for decisive, coordinated action — especially on trade. She urged the world’s economic powerhouses to settle their trade disputes and restore confidence to the global system. “A trade policy settlement among the main players is essential,” she said. “Uncertainty is very costly. Predictability is what brings back investment and growth.”
Georgieva outlined targeted actions for key economies:
- China should stimulate private consumption and pivot toward a service-based economy.
- The United States needs to tackle its mounting fiscal deficits.
- Europe must complete its long-delayed Single Market and Banking Union.
Across the board, she pushed for the removal of both tariff and non-tariff barriers to reestablish openness and trust in the global trading system.
But her agenda extended far beyond trade. With many nations still reeling from recent shocks and their policy buffers exhausted, Georgieva called on governments to rebuild fiscal space and ensure debt sustainability. “We cannot have countries with a tax-to-GDP ratio below 15%,” she said, referring particularly to low-income nations that are struggling with declining aid and rising borrowing costs. For them, she emphasized, domestic revenue mobilization is not optional — it’s essential.
On monetary policy, Georgieva acknowledged diverging realities across countries. While inflation is easing in some regions, it remains stubborn in others. She urged central banks to walk a fine line — supporting growth while keeping inflation in check. She also reaffirmed the importance of central bank independence and encouraged emerging markets to maintain flexible exchange rates to absorb shocks.
The third pillar of her message was a strong call for growth-oriented structural reforms. “We were already in a low-growth, high-debt world before these latest challenges,” she reminded her audience. Now, overdue reforms — including improving business environments, modernizing labor markets, and accelerating innovation — are more critical than ever. The IMF, she assured, stands ready to help with policy advice, diagnostics, and, where needed, financial assistance.
Georgieva also highlighted efforts to strengthen the global financial safety net. She cited closer cooperation with regional financial arrangements and the rollout of a new framework under the Global Sovereign Debt Roundtable aimed at streamlining and speeding up debt restructuring processes.
Throughout her address, Georgieva returned to a central theme: global cooperation is more vital than ever in this increasingly multipolar world. She praised the United States for reaffirming its commitment to the IMF and emphasized that only through collective action can nations navigate the complex web of overlapping economic shocks.
“In challenge, there is opportunity,” she concluded. “Let us not focus on preserving the past but on building a new, more resilient global economy.”
The message from Washington was clear: the world cannot afford to delay. With firm leadership, focused reforms, and strong international cooperation, this moment of uncertainty can be transformed into one of renewal and growth. ZIJ/30/4/2025
 Managing Director Kristalina Georgieva. Addressing the world’s economic media during the IMF-World Bank 2025 Spring Meetings in Washington, Georgieva issued a stark warning: the combination of slowing growth, persistent inflation, and geopolitical trade tensions is straining economies across the globe — and indecision is only making matters worse.){kind=link}