## Coping and Thriving in a Fluid World

_IMF News, March 9, 2026_

## Source details

**Canonical URL:** [Coping and Thriving in a Fluid World](https://www.imf.org/en/news/articles/2026/03/09/sp030926-coping-and-thriving-in-a-fluid-world)

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## Bibliographic details
- Published: March 9, 2026

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### Overview
- Keynote Speech by IMF Managing Director Kristalina Georgieva at Japan's Ministry of Finance's "Future of the Global Economy amid a Fluid International Economic and Monetary Order" Symposium in Tokyo, Japan, March 9, 2026.
- Central theme: global economy is "fluid" due to deep currents of change—in technology and demographics, in geopolitics and trade, in climate—while also facing repeated shocks.
- IMF global growth forecasts cited: 3.3 percent in 2026 and 3.2 percent in 2027.

### Recent shocks, risks, and immediate impacts
- New conflict in the Middle East testing resilience: important oil and gas facilities suffered damage and stoppages; shipping traffic through the Strait of Hormuz has fallen by 90 percent.
- Two factual exposures highlighted:
  - About a fifth of global oil supply and LNG trade normally transits through the Strait of Hormuz; this includes almost half of Asia’s oil imports and about one-quarter of its LNG imports.
  - For Japan: almost 60 percent of oil imports and 11 percent of LNG imports transit that route.
- Price movements and regional energy impacts:
  - World oil prices are up nearly 50 percent since December, while Asia and Europe face steep increases in gas prices.
- Rule-of-thumb macro impact:
  - Every 10 percent increase in oil prices—if persistent through most of this year—results in a 40 basis point increase in global headline inflation and a 0.1–0.2 percent fall in global output.
- IMF action: collecting data, analyzing impact, and preparing the upcoming World Economic Outlook.

### Structural transformations and opportunities
- Twin transformations emphasized: AI and demographics reshaping job markets.
  - AI: vast potential to raise productivity but will eliminate old jobs and create new ones; harnessing it requires careful policymaking.
  - Demographics: a multi-speed world—aging societies need more labor force participation and more automation; youthful populations need jobs.
- Quantitative estimates:
  - In Asia, the IMF estimates AI could boost annual growth by up to 0.8 percentage points over the medium term.
  - A push for closer regional trade links within Asia—focused on lowering nontariff barriers—could raise Asian GDP by 1.8 percent, on average, in the long run.
- Japan-specific note: having long been at the forefront in automation, Japan seeks the largest possible productivity boost from AI and is navigating demographic change supported by strong institutional foundations.

### Financial buffers and policy space
- Role of buffers:
  - Private sector buffers allow firms to compress profit margins to absorb shocks; exporters and importers have limited passthrough of higher tariffs to sales prices in the last 11 months, notably in the U.S. market.
  - Public sector buffers enable countercyclical fiscal policy; example given is the global policy response to the pandemic.
- IMF advice on buffers:
  - Maintain fiscal space so it can be used as a policy offset when shocks come and private demand slackens.
  - Replenish buffers in good times, ideally formalized in a robust medium-term fiscal framework.

### Agility and policy design
- Agility as critical complement to buffers: governments must be attentive to data, see opportunities in uncertainty, and act nimbly.
- Regional integration example:
  - EU internal trade ~60 percent of total trade; ASEAN internal trade ~20 percent — scope for deeper regional links in Asia.
- Central bank example:
  - Central banks should follow mandates but be attentive to data; Japan’s central bank is cited as responding nimbly to a transition out of prolonged below-target inflation.

### IMF role and Japan’s contributions
- IMF functions emphasized: surveillance, lending, and capacity development; policy advice as transmission line for best practice; capacity development improves nuts and bolts; lending provides a safety net.
- Current IMF lending position cited: over $165 billion in total credit outstanding.
- Japan’s contributions highlighted:
  - Japan is the IMF’s second-largest shareholder.
  - Japan is the largest donor to capacity development and concessional lending.
  - Japan supports the IMF through financial contributions to quota base and concessional lending facilities for low-income countries, peer review participation, support for the Regional Office for Asia and the Pacific in Tokyo, and other leadership roles.

### Policy recommendations (three core pieces of advice)
- Invest in strong institutions and policy frameworks to underpin strong economies and private sector-led growth:
  - Examples include independent central banks, fiscal rules, and other policy frameworks.
- Use policy space when needed and be sure to replenish it:
  - Maintain fiscal space and formalize replenishment in medium-term fiscal frameworks.
- Above all, be agile:
  - Governments should act nimbly to both manage risks and seize opportunities (e.g., regional trade integration, AI adoption, labor market adjustments).

*Keynote Speech by IMF Managing Director Kristalina Georgieva at Japan's Ministry of Finance's "Future of the Global Economy amid a Fluid International Economic and Monetary Order" Symposium, March 9, 2026.*

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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)
- [Japan and the IMF](http://www.imf.org/external/country/JPN/index.htm)
- [Speeches](https://www.imf.org/en/news/searchnews)
- [PRESS CENTER](http://presscenter.imf.org/)
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_Source: https://www.imf.org/en/news/articles/2026/03/09/sp030926-coping-and-thriving-in-a-fluid-world_