In a world of more shocks and more volatility, the silver lining is that the impossible becomes possible, said IMF Managing Director Kristalina Georgieva in a discussion with the Wall Street Journal’s Gerard Baker at the Milken Institute’s 2025 Global Conference.
“What is amazing is that the world economy has proven to be remarkably resilient to these shocks. We had COVID, then we had the war in Ukraine, then we had inflation. Now we have aremake of trade relations in a very dramatic way. And yet, when you look at the performance of economies, it is actually impressive. Why is it that the world economy has been so resilient? It’s a little bit related to the mission of the Fund, because since the [2008-09] global financial crisis, countries have worked hard to build sound macroeconomic fundamentals, and this is paying off at the time of shock,” said Georgieva.
Georgieva pointed to the example of Argentina, noting that the country last year saw its first budget surplus in more than a decade. “Bring inflation down, create conditions for the economy to prosper. Bring growth up. And what Argentina did, many would say it seemed impossible.”
When asked how she thought policymakers might respond given slower growth and accelerating inflation, Georgieva noted that she expected to see activity around trade relationsand more bilateral and plurilateral agreements.
“I also expect to see countries finally doing what they should have been doing anyway… First, trade more with each other. ASEAN now is going to integrate more; the Gulf Cooperation Council can integrate more. And secondly, think of the reforms we advocate for because of our mission and mandate – these fundamental changes should no longer be postponed or delayed.
