## Difficult But Doable: Managing Director Kristalina Georgieva's Remarks on Global Economic Challenges and the Role of APEC

_IMF News, November 16, 2024_

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**Canonical URL:** [Difficult But Doable: Managing Director Kristalina Georgieva's Remarks on Global Economic Challenges and the Role of APEC](https://www.imf.org/en/news/articles/2024/11/16/opening-remarks-at-apec-summit-in-peru)

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## Bibliographic details
- Published: November 16, 2024

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### Global outlook and inflation
- Inflation is "retreating" in the US, in Europe, and "even more so in Asia."
- This disinflation has occurred "without the economy slipping into recession."
- IMF projection: growth "to reach 3.2 percent both this and next year."
- APEC is "growing above the global average this year."
- Despite falling inflation, "the higher prices people feel in their wallets are here to stay."

### Growth performance and public debt
- Medium-term global growth is "just around 3 percent."
- Pre-pandemic decades growth was "3.8 percent," implying the pace is "slower than in the pre-pandemic decades by almost one percentage point."
- Global public debt is "reaching 100 percent of GDP."
- High interest rates raise debt service while low growth reduces revenues, "tightly constricting" government budgets relative to demands for education, infrastructure, and social services, especially in aging societies.

### Trade, integration, and fragmentation risks
- Trade is "no longer the powerful engine of growth it used to be" in a "more fractured world."
- Drivers include national security concerns, political backlash from those who lost out, a "mushrooming of industrial policy measures, trade barriers, and protectionism."
- Expected new trade restrictions: "over 3,000" worldwide this year.

### Policy priorities and trade-offs for policymakers
- Policymakers need to pursue two simultaneous goals:
  - Fiscal consolidation to rebuild buffers for the next shock while preserving space for priority public investments, including massive needs of the green and digital transformations.
  - Ambitious reforms to lift growth potential and energize job-creation, focusing on mobilizing private capital, improving productivity, and in some cases strengthening institutions and governance.
- Fiscal consolidation requires difficult choices on how to raise revenues and make spending more efficient, and "ensuring that policy actions are well-explained to earn the trust of the people."
- "Fiscal restraint is never popular" and is becoming harder as "even traditionally fiscally conservative political parties are developing a taste for borrow-to-spend."
- Prudent fiscal rules are "paramount" to anchor government spending.
- Reform momentum has slowed "since the global financial crisis" as discontent has grown, but "progress is possible."

### What works — lessons from resilient APEC economies
- Key successful elements: good policy design, good communication, and support for those who lose out from change.
- Specific policy actions highlighted:
  - Labor market reforms.
  - Investment in human capital, R&D, and physical and digital infrastructure.
  - Deepening capital markets and developing ecosystems that provide financing, knowledge, advice, and professional networks—"all very critical in the world of AI."

### Role of APEC and IMF support
- Support for APEC ambition to make the Asia-Pacific region "more sustainable, more digital, more resilient, and more APEC-focused."
- Economic integration and multilateral action are "essential for raising growth and solving global problems."
- The IMF stands ready as a partner to provide impartial economic analysis, tailored policy advice, and financial support to members hit by shocks.
- Closing message: "Working together, as APEC shows, remains essential for preserving economic progress."

*Remarks by IMF Managing Director Kristalina Georgieva at the APEC Leaders' Retreat in Lima, Peru — November 16, 2024*

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## References

- [https://www.imf.org/en/about/senior-officials/bios/kristalina-georgieva](https://www.imf.org/en/about/senior-officials/bios/kristalina-georgieva)
- [Peru and the IMF](http://www.imf.org/external/country/PER/index.htm)
- [Speeches](https://www.imf.org/en/news/searchnews)
- [PRESS CENTER](http://presscenter.imf.org/)
- [https://www.imf.org/en/home](https://www.imf.org/en/home)

_Source: https://www.imf.org/en/news/articles/2024/11/16/opening-remarks-at-apec-summit-in-peru_