ISTANBUL
International Monetary Fund (IMF) Managing Director Kristalina Georgieva on Thursday warned against weak global economic growth.
“The sobering reality is global economic activity is weak by historical standards,” she said during her speech at the Atlantic Council. “Prospects for growth have been slowing since the global financial crisis.”
Georgieva said inflation is not fully defeated, adding that fiscal buffers have been depleted, and rising debt levels pose a major challenge to public finances in many countries.
“The scars of the pandemic are still with us. The global output loss since 2020 is around $3.3 trillion, with the costs disproportionately falling on the most vulnerable countries,” she said.
The IMF chief said the US has seen the strongest rebound among advanced economies since the pandemic helped by rising productivity growth, but activity in the euro area is recovering more gradually due to effects of high energy prices and weaker productivity growth.
She stressed that the main driver of weaker economic growth is “a significant and broad-based” slowdown in productivity, adding: “Our analysis shows it accounts for over half of the growth slowdown in advanced and emerging economies, and nearly all in low-income countries.”
