IMF Chief Urges Swift Action to Resolve Trade Tensions Threatening Global Economy

IMF Managing Director Kristalina Georgieva has called on countries, particularly the United States, to urgently resolve trade disputes and restore predictability to the global economy, warning that President Donald Trump’s aggressive tariffs and abrupt policy changes have spiked uncertainty and contributed to weaker economic growth forecasts. She emphasized that this uncertainty discourages business investment and consumer spending, exacerbating risks of a global slowdown and raising recession probabilities, especially in the U.S. Georgieva highlighted that the economic fallout from trade conflicts would disproportionately impact poorer nations, which lack the fiscal space to buffer shocks. The IMF has downgraded its global and U.S. growth outlooks, citing elevated tariff rates and unpredictable trade policies as major factors. The Fund further urged nations to strengthen fiscal buffers and pursue domestic reforms, while warning that escalating trade tensions and reduced international cooperation could undermine both immediate and long-term global economic prospects. The current environment of heightened policy uncertainty threatens to further destabilize fragile growth, making swift, constructive action essential.