## Press Briefing Transcript: IMF Managing Director Global Policy Agenda Transcript, Annual Meetings 2025

_IMF News, October 16, 2025_

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## Bibliographic details
- Published: October 16, 2025

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### Global growth outlook and macroeconomic state
- Global growth projections from the World Economic Outlook:
  - 3.3 percent last year
  - 3.2 percent this year
  - 3.1 percent in 2026
- Characterization: "better than feared but worse than needed."
- Medium-term concerns:
  - Medium-term growth prospects remain weak.
  - Public debt is near-record highs and continues to climb.
  - The global economy is "excessively imbalanced."
  - Uncertainty has continued to go "up, up, up."

### Drivers of recent resilience
- Two core reasons the global economy has been more resilient than feared:
  - Improved policy fundamentals: many countries, especially emerging markets, have strengthened institutions and frameworks since the Global Financial Crisis.
  - Private sector adaptability: examples include import frontloading and supply-chain strengthening.
- Warning: resilience notwithstanding, the outlook is underwhelming and requires further policy action.

### Fiscal and monetary policy priorities (IMF Global Policy Agenda)
- Overarching IMF priorities emphasized:
  - Unlock private-sector growth to deliver jobs and better livelihoods.
  - Secure sound macroeconomic fundamentals to navigate greater turbulence.
  - Reduce global imbalances.
- Fiscal policy guidance:
  - Rebuild fiscal space and reduce debt.
  - Rely more on domestic sources of revenues.
  - Make "smart budget choices."
- Monetary and financial sector guidance:
  - Preserve stability and guard against financial stability risks.
- On global imbalances:
  - Countries with excessive surpluses, "like China," should boost domestic demand, "including by spending less on industrial policy and more on social safety nets."
  - Countries with excessive deficits, "notably the United States," need to reduce fiscal deficits and incentivize private savings.

### IMF institutional work and programmatic priorities
- Ongoing and planned IMF work highlighted:
  - Comprehensive Surveillance Review to sharpen focus on surveillance, including advice on trade policies and domestic reforms to rebalance the economy.
  - Ongoing review on conditionality to strengthen program design.
  - Mobilize members to fully implement the PRGT reform agreed last October to preserve capacity to finance low-income countries.
  - Call to consider replenishing the Catastrophe Containment and Relief Trust (CCRT), described as "depleted."
  - Continued work on the Global Sovereign Debt Roundtable and reviewing the debt sustainability framework for low-income countries.
  - Intention to make more systemic use of IMF "good offices" to improve coordination between creditors and debtors.

### AI, its macroeconomic contribution, and preparedness
- IMF assessment of AI's potential contribution to growth: somewhere between 0.1 and 0.8 percent.
- Caveats and conditions:
  - AI's contribution depends on two main enablers: energy supply at scale and penetration of AI across sectors to lift productivity.
  - Energy demand for AI is described as "equivalent to half of the energy consumption of the United States."
  - Current AI investment distribution is heavily concentrated in the United States; the rest of the world trails.
- IMF AI Preparedness Index:
  - Ranks 174 countries on four criteria: digital infrastructure, labor market skills, innovation (penetration into sectors like transport, agriculture, healthcare), and regulation and ethics.
  - Distribution: advanced economies and some emerging markets (including China and most of the Gulf) concentrate in the top one third; low-income countries are at the bottom.
  - Risk: AI could raise productivity while increasing divergence within and across countries—hence the emphasis on preparedness.

### Financial stability and nonbank financing risks
- Financial Stability Report highlights:
  - A significant shift of financing from the banking sector to nonbank financial institutions; "more than half of financing is now there."
  - Nonbank financial institutions do not have the same regulatory oversight as banks, raising vulnerabilities if the sector grows further.
- IMF concern: potential for more severe stress depends on real-economy performance and the magnitude of nonbank institutions in trouble.
- Context: global lessons from the Global Financial Crisis have improved frameworks and reserves in many economies, but fiscal buffers are largely exhausted and monetary policy still wrestles with inflation.
- Policy implication: greater attention and oversight of nonbank financial institutions are urged.

### Country and regional assessments, examples, and recommendations
- Group of 7 (directional fiscal view):
  - Debt build-up driven primarily by advanced economies (and some emerging markets).
  - Countries identified as needing fiscal consolidation: the United States, France, Italy.
  - Japan also highlighted as needing to "look into their borrowing."
  - Germany and Canada described as "in a better position."
- Canada-specific notes:
  - Authorities modernizing the budget framework by separating operating expenses from investment to focus on progrowth investment.
  - Moving the budget presentation from spring to early November to better align with construction season and signal predictability for investment projects.
  - Priority spending areas: housing, infrastructure, energy.
- China:
  - Growth projections: 4.8 percent this year and 4.2 percent (presumably next year).
  - China is growing faster than the global average and thus contributing to global growth.
  - China faces a "fork in the road" between export-oriented model and reorientation toward domestic consumption.
  - Three priorities for China to support domestic rebalancing:
    - Resolve real estate sector problems decisively to restore consumer confidence.
    - Increase social safety nets and redirect spending away from industrial policy.
    - Open up and deepen market activity in services (education, healthcare, other services).
  - Note: "China has been spending about 4 percent of GPA to support industries" (IMF comment on past industrial policy spending).
- Senegal:
  - Senegal uncovered a major hidden-debt misreporting problem and requested an IMF program.
  - IMF dispatched/dispatching a team immediately after the Annual Meetings to assist; IMF engaged constructively with Senegalese authorities.
  - IMF does not comment on rating agencies' downgrades.
- Middle East:
  - Ceasefire and reduced tensions would provide a "peace dividend" benefiting economies such as Egypt, Jordan, Lebanon.
  - IMF already has programs with Egypt and Jordan; Lebanon has requested a program; IMF teams have engaged with Syria on rebuilding institutions, including the central bank.

### Trade, protectionism, and implications for growth
- Multilateral trade stance:
  - Of 191 IMF members, only three have moved more forcefully on tariffs (United States, China, and to a certain degree Canada); 188 countries continue to prefer trading on most-favored-nation rules.
  - IMF encourages countries to avoid trade restrictions; warns that tariff use by large economies can be counterproductive for open economies.
- Regional trade integration:
  - Growing ambition for regional trade integration in places such as the Gulf Cooperation Council, ASEAN, and Central Asia.
- India:
  - India cited as an "efficient growth engine" due to significant reforms (tax reform, infrastructure, digital infrastructure).
  - Recommendations for India:
    - Continue reforms that have driven growth.
    - Consider greater trade integration and removal of self-imposed trade barriers.
    - Invest further in education, skills, and pro-private-sector regulation to lift productivity and growth.

### Inflation and trade tensions
- Inflation trends:
  - Overall inflation trending down with regional differences: parts of Asia disinflating (in some places arguably "too far"), euro area around target, United States somewhat higher.
- Trade tensions and inflation:
  - Tariffs act as an inflationary push for the originating country but may contain inflation for countries on the receiving end.
  - So far, tariff impacts on US inflation have been "moot" due to:
    - Importing and exporting firms absorbing costs in profits.
    - Prepositioning of inventories.
    - Supply-chain adjustments that may ease price pressures.
  - IMF warning: flareups of trade tensions would have negative spillovers and are discouraged.

### Concluding framing
- Central message from the Managing Director:
  - "Uncertainty is here to stay, and change is unstoppable, but with change comes opportunity."
  - IMF pledges to help countries pursue opportunities and provide calibrated, detailed country-specific advice.
  - IMF positions itself as a prudent steward of members' resources and an active partner in strengthening stability, resolving balance of payments problems, and supporting reforms.

*Transcript: Press Briefing Transcript: IMF Managing Director Global Policy Agenda Transcript, Annual Meetings 2025*

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_Source: https://www.imf.org/en/news/articles/2025/10/16/tr-10-16-25-imf-md-gpa-press-briefing-transcript-annual-meetings-2025_