The International Monetary Fund (IMF) has highlighted that the global growth outlook for the medium term is at its lowest in several years.
However, the organization pointed out that collective action by G20 nations on climate change, reducing trade barriers, and establishing global standards for artificial intelligence (AI) could enhance growth prospects
IMF’s Managing Director, Kristalina Georgieva, called on G20 countries to take decisive action to regain the momentum for policy reforms that have been overshadowed by emergency responses to the COVID-19 pandemic and the conflict in Ukraine.
With an anticipated global growth of 3.1% in 2024, and with inflation rates decreasing and employment markets remaining stable, Georgieva emphasized the importance of strengthening fiscal safeguards, increasing domestic revenue, managing public debt, and leveraging AI to improve economic growth in a blog post that coincided with an IMF report for the G20.
Addressing the G20 finance officials in Sao Paulo, she expressed concern over the global low growth rate’s impact, especially on emerging markets and developing countries that are still recovering from successive global crises.
Georgieva highlighted the importance of expanding the tax base, sealing tax loopholes, and enhancing tax administration, mentioning a joint initiative by the IMF and World Bank requested by the G20.
According to the IMF report, the gap in income per capita between emerging markets and developed nations is now expected to take 130 years to halve, a significant increase from the 80 years estimated before the 2008 financial crisis.
Under Brazil‘s G20 presidency, which is focused on addressing inequality and climate change, there’s an opportunity for G20 policymakers to aim for a future that is more equitable, prosperous, sustainable, and collaborative.
Georgieva also advised central banks to monitor inflation closely and cautioned against premature or rapid easing of monetary policies.
