IMF Warns AI, Energy, Debt Threaten Growth

Kristalina Georgieva warned that high energy prices, record public debt and AI risks threaten growth, previewing next week's IMF and World Bank meetings in Bangkok. She said a Middle East energy supply shock and an AI demand shock are pulling the world in opposite directions, with highly uneven impact across countries. Oil remains at $100 a barrel plus about $100 in crack-spread margins—the extra cost of refining crude into fuel—and high prices will likely persist even if the Gulf war ends soon. Public debt is at its highest since World War Two and projected to exceed 100% of GDP before 2030. After five-and-a-half years of above-target inflation, she urged fiscal consolidation in high-debt advanced economies, a prudently hawkish monetary bias, and central bank independence, warning against monetary cowboys running to the rescue of fiscal agents. AI done right could add half a percentage point of annual world growth, she said, if guardrails handle labour fallout, cyber risks and frontier models that could run amok. Wire reports on separate IMF research said 23 million more people fell below the extreme-poverty line from 2021 to 2024 than previously estimated. New forecasts land next week; July's outlook was 3.0% growth in 2026 and 3.4% in 2027. What's contested: none found in the record.