International Monetary Fund (IMF) Managing Director Kristalina Georgieva has stated that a global recession is not on the horizon despite concerns over trade policies, particularly the impact of tariffs. In a recent interview, she acknowledged that while tariffs have weakened consumer and investor confidence, they have not yet triggered a significant economic downturn.

The IMF is set to release its updated economic outlook in the forthcoming World Economic Outlook (WEO) report, reflecting the latest developments. Georgieva emphasized the need for stable trade policies to support economic growth. She noted that while the U.S. economy is still projected to grow, trade policy fluctuations have dampened expectations.

However, concerns about the global economic landscape persist. Georgieva pointed out that many countries have exhausted their fiscal and monetary reserves due to the COVID-19 crisis, which poses risks in managing future economic shocks. Another key concern is the rising level of public debt, which has surged to 93% of global economic output, compared to 84% in 2019.

The IMF has also warned about sluggish global growth, forecasting a modest 3.2% growth rate for both 2024 and 2025, slightly down from 3.3% in 2023. This stagnation is attributed to increasing protectionism, stalled trade agreements, and structural challenges such as aging populations and declining productivity.

Georgieva underscored the necessity of cooperation and strategic reforms, particularly in Europe, to address these economic challenges. She stressed the importance of policies that enhance productivity, foster inclusivity, and promote sustainable growth to prevent prolonged economic stagnation.

While the immediate threat of a global recession remains low, the IMF remains cautious about broader economic trends. Georgieva called for prudent policy measures and stronger international cooperation to navigate these uncertainties and ensure long-term economic stability.