by Nick R. Hamilton, Slay News:
The head of the International Monetary Fund (IMF) has warned that the world is heading toward a “dangerous new normal.”
Kristalina Georgieva, managing director of the IMF, warns that the world is facing the risk of a recession, with the global economy experiencing a “fundamental shift.”
Georgieva made the comments during a speech at Georgetown University in Washington on Thursday.
In just three years, the world has lived through “shock, after shock, after shock,” Georgieva said.
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The world had to deal with the COVID-19 pandemic, the Russian invasion of Ukraine, and “climate disasters on all continents,” she claimed.
She said that such shocks have caused “immeasurable harm” to people’s lives.
The combined effect has been a surge in the prices of goods, especially energy and foods, creating a cost-of-living crisis, she said.
The world is seeing a “fundamental shift” in the global economy, moving away from a world of relative predictability— which had a rules-based framework for international economic cooperation, low inflation, and low-interest rates—to a world of more fragility, greater uncertainty, geopolitical confrontations, higher economic volatility, and more frequent devastating natural disasters, she said.
To prevent this period of heightened fragility from becoming a “dangerous new normal,” the world must focus on stabilizing the global economy, revitalizing cooperation, and transforming the economy to build resilience against any future shocks, Georgieva said.
Uncertainty remains “extremely high” in the context of the pandemic and Russia’s war in Ukraine.
