IMF warns of global economic risks amid trade tensions, AI disruption, market transformation
These structural changes — along with digital transformation and demographic shifts — present not only significant challenges but also new opportunities for innovation and growth — Saudi Finance Minister
Member countries of the International Monetary Fund (IMF) voiced concern on Friday over mounting pressures and uncertainties stemming from escalating trade tensions, rapid advances in Artificial Intelligence, and ongoing transformations in global markets.
Despite these challenges, the IMF’s steering committee expressed optimism for continued global growth and a further easing of inflation.
In a statement issued by the Chairman of the International Monetary and Financial Committee (IMFC), which represents the 191 member economies, the Fund highlighted several downside risks — including slowing economic growth, high debt levels, severe climate events, persistent global imbalances, and ongoing conflicts, reports Al-Rai daily.
Saudi Finance Minister Mohammed Al-Jadaan, who currently chairs the IMFC, noted that major shifts in trade policies and other developments are reshaping global markets and policy frameworks, deepening uncertainty.
He emphasized that these structural changes — along with digital transformation and demographic shifts — present not only significant challenges but also new opportunities for innovation and growth.
The committee’s statement also underscored that inflation trends will diverge among countries. IMF officials cautioned that economies imposing tariffs, such as the United States, could experience prolonged inflation, while others — notably in Asia, including China — face risks of deflation.
The statement reaffirmed the importance of preserving the independence of central banks to sustain policy credibility. It also urged policymakers to address financial vulnerabilities by “enhancing oversight of systemic risks arising from artificial intelligence, non-bank financial institutions, and digital assets, while harnessing the benefits of financial and technological innovation.”
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