While Georgieva praised the work of major central banks to tame inflation, she noted that some economies continue to struggle with high prices
Its head International Monetary Fund warned that high debt and low growth remain major impediments to the global economy.
Kristalina Georgieva told CNBC that while there had been remarkable progress in the global economic recovery, governments had become accustomed to excessive borrowing, with “anemic growth” adding to the challenges of servicing that debt.
“It’s not yet time to celebrate,” he said. “When we look at the challenges ahead, the biggest is low growth, high debt. This is where we can and must do better,” he added.
While Georgieva praised the work of major central banks in taming the inflationnoted that achievements have not been universal and that some economies continue to struggle with high prices, which is increasing social and political discontent.
“It’s some big economies that have done very well and some others where inflation is still a problem,” he said.
“The impact of high prices remains and is making many people in many countries feel worse and angry.”
The comments come as finance ministers and central bank governors are set to meet next week in Washington for the annual meeting of the IMF and World Bank. They will discuss topics such as the global economic outlook, poverty eradication and the transition to green energy.
Georgieva warned that international trade would no longer be the “engine of growth” it once was, highlighting the proliferation of restrictive policies in many economies.
The US and European Union have moved to impose a series of tariffs against China over what they see as Beijing’s unfair trade practices.
“We see in the United States, and elsewhere, pressures from people who reasonably feel that globalization has not worked for them. All this is indeed creating an environment of mistrust and now it is advanced economies rather than emerging markets that are leading the way in imposing protectionist measures.”
The IMF managing director has warned against such restrictions in the past, telling CNBC in June that the growing “love” of restrictions such as tariffs is damaging to international growth.
Now he repeats the message by insisting that such measures can harm both those who impose them and those on whom they are imposed.
“Our advice is to carefully consider the pros and cons and what it might mean in the medium term. And of course we count them too,” he said.
Source: Skai
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