Global Economy at a Crossroads: IMF Warns of Slow Growth and High Debt

The head of the International Monetary Fund, Kristalina Georgieva, warned of a stagnating world economy marred by conflict and high debt. With geopolitical tensions rising, including frosty US-China relations, global growth is forecast at 3.2% this year. Georgieva urged China to invigorate its slow economy.

The global economy is under threat of stagnation, warned Kristalina Georgieva, head of the International Monetary Fund, during a briefing on Thursday. With mounting geopolitical tensions and skyrocketing debt levels, the IMF forecasts an anemic growth rate of 3.2% for this year.

Georgieva expressed specific concern over China, urging its leaders to take decisive actions to rejuvenate their sluggish economy. She emphasized the need for China to shift from export dependence to consumer spending to boost growth, warning that inaction could result in growth falling below 4%.

Despite these challenges, inflation control has shown progress, with expected reductions in wealthy nations next year. However, global trade remains sluggish amid deteriorating US-China relations, and global debts are projected to exceed USD 100 trillion.

(With inputs from agencies.)