Artificial intelligence poses risks to job security around the world but also offers a “tremendous opportunity” to boost flagging productivity levels and fuel global growth, the IMF chief told AFP.
“We must focus on helping low income countries in particular to move faster to be able to catch the opportunities that artificial intelligence will present,” Georgieva told AFP.
“So artificial intelligence, yes, a little scary. But it is also a tremendous opportunity for everyone,” she said.
The IMF is due to publish updated economic forecasts later this month which will show the global economy is broadly on track to meet its previous forecasts, she said.
It is “poised for a soft landing,” she said, adding that “monetary policy is doing a good job, inflation is going down, but the job is not quite done.”
“So we are in this trickiest place of not easing too fast or too slow,” she said.
The global economy could use an AI-related productivity boost, as the IMF predicts it will continue growing at historically muted levels over the medium term.
“God, how much we need it,” Georgieva said. “Unless we figure out a way to unlock productivity, we as the world are not for a great story.”
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– ‘Tough’ year ahead –
Georgieva said 2024 is likely to be “a very tough year” for fiscal policy worldwide, as countries look to tackle debt burdens accumulated during the Covid-19 pandemic, and rebuild depleted buffers.
Billions of people are also due to go to the polls this year, putting additional pressure on governments to either raise spending or cut taxes to win popular support.
“About 80 countries are going to have elections, and we know what happens with pressure on spending during election cycles,” she added.
The concern at the IMF, Georgieva said, is that governments around the world spend big this year and undermine the hard-won progress they have made in the fight against high inflation.
“If monetary policy tightens and fiscal policy expands, going against the objective of bringing inflation down, we might be for a longer ride,” she added.
– Concentrating on the job –
Georgieva, whose five-year term at the IMF’s helm is set to end this year, refused to be drawn on whether she intends to run for a second stint leading the international financial institution.
“I have a job to do right now and my concentration is on doing that job,” she said.
“It has been a tremendous privilege to be the head of the IMF during a very turbulent time, and I can tell you I’m quite proud of how the institution coped,” she continued.
