Georgieva urges countries to cut debt as AI surge reshapes economies
IMF chief warns of growing inequality and higher borrowing costs as AI concentrates gains in parts of Asia.
The head of the International Monetary Fund, Kristalina Georgieva, warned that countries need to act quickly to reduce public debt and rising inequality as their economies confront the surge of artificial intelligence, higher borrowing costs and shocks from wars in the Middle East and Ukraine.
Regional winners — and those left behind
Georgieva highlighted that seven of the ten countries with the largest increase in AI-related trade are in Southeast Asia, and that the region’s share of global economic activity rose from 25 percent in 199-va to 43 percent today.
According to her remarks, major economies such as China, India, Japan, South Korea and Taiwan have captured significant gains from the AI boom, but many other countries are being bypassed — a dynamic that risks widening inequality both within and between countries.
She urged policymakers to take swift measures to rein in debt levels and address distributional pressures while preparing for tighter global financing conditions. Georgieva singled out rising borrowing costs and geopolitical shocks as immediate risks that can compound the economic effects of technological change.
Her call to action places emphasis on balancing short-term stability with long-term adjustments: improving public finances, targeting social support to vulnerable groups, and investing in skills and institutions so economies can better absorb AI-driven change.
Photo: press material from the event
