The International Monetary Fund (IMF) has called for stronger international cooperation as artificial intelligence (AI), geopolitical tensions and rising government debt create new challenges for the global economy.
The warning came during the IMF and World Bank's annual meetings in Bangkok on October 16, 2026.
IMF Managing Director Kristalina Georgieva said rapid technological change, persistent conflicts and high energy and food prices could deepen economic inequality, according to Reuters report.
Georgieva stressed that countries must work together to manage these challenges and ensure that developing economies benefit from advances in AI.
The IMF has projected global economic growth of 3.1% for 2026. However, the outlook remains below historical averages.
The ongoing Middle East conflict and disruptions to energy supplies have added pressure on economies worldwide. Higher borrowing costs and growing public debt have also increased concerns among policymakers and investors.
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US Sees Stronger Economic Prospects
Washington presented a more optimistic assessment of the global outlook. US Treasury Under Secretary Erin Browne pointed to strong American economic output, stock market gains and innovation as important drivers of growth.
She argued that AI development, greater energy production and policy changes aimed at encouraging investment could improve productivity and support long-term economic expansion.
US officials also urged the IMF to give greater attention to potential growth opportunities instead of focusing mainly on economic threats.
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AI Boom Creates Both Opportunity and Risk
Financial markets have shown signs of uncertainty as investors reassess the sustainability of heavy investment in AI. South Korean shares recorded their steepest weekly decline in 18 years, while Japan's stock market fell 5.4% during the week.
A sharp slowdown in AI investment could hurt asset prices and weaken business confidence. Meanwhile, continued conflict and elevated energy costs could further restrict growth.
The discussions highlight a key challenge for policymakers and that is encouraging technological progress while protecting financial stability.
For developing economies, access to digital infrastructure, affordable energy and responsible AI policies will be crucial to ensuring that future gains are shared more widely.
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