Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), said the Fund expects global interest rates to decline by 40 percent by mid-2024.
“We are very confident that the world economy is now poised for this soft landing that we have been waiting for,” she said at a plenary session on the first day of the World Governments Summit (WGS) 2024.
“We have learned through experience that economic fundamentals matter, and in the US they are strong. The US has deep capital markets; a very dynamic economy, particularly in new technologies; and the ability of its economy to quickly adjust, which is attractive for investments,” Georgieva said.
Responding to a question on why the US has responded so strongly at a time of high-interest rates, Georigieva said: “The US benefits from being a source of energy in terms of oil and gas.”
During the session, which was moderated by CNN’s Richard Quest, Georgieva also praised the UAE’s readiness to use artificial intelligence (AI) technologies and commended the nation for its foresight to establish a ministry for artificial intelligence in 2017 at a time of global reluctance on this matter.
“The shift towards AI will be similar to the Industrial Revolution in terms of scale and significance of impact,” Georgieva said.
The IMF head also pointed out that it will affect up to 40 percent of the labour market, with new jobs emerging as existing jobs either transform or disappear.
Georgieva said an IMF report has revealed the readiness of the UAE and Saudi Arabia for this transformation, while “the majority of countries, primarily developing nations, are not.”
“The UAE must now lead the world in the responsible, humanity-serving adoption of AI,” Georgieva said, while also supporting other countries by investing in developing nations and emerging markets.
The aim, she said, is to support them in benefitting from this technology, but also “managing its negative potential consequences.”
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