World faces risk cocktail from AI, oil and debt, IMF chief says

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Defence Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomeNewsEconomyWorld faces risk cocktail from AI, oil and debt, IMF chief saysThe gathering of top finance ministers takes place against a backdrop of turbulence in sovereign debt marketsAuthor of the article:Kristalina Georgieva, managing director of the International Monetary Fund (IMF), speaks at the IMF Annual Meetings Curtain Raiser in Singapore on Oct. 7, 2026. Photo by Roslan RAHMAN / AFP via Getty ImagesGlobal governments must act urgently to address challenges from an unbalanced AI boom, a prolonged energy shock and record debt piles, the International Monetary Fund said as it prepares to host economy chiefs from around the world next week.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountThe rush to develop artificial intelligence is delivering a growth spurt that’s so far confined to a handful of countries, Managing Director Kristalina Georgieva said Wednesday in prepared remarks in Singapore ahead of the annual IMF-World Bank meetings in Bangkok next week.This advertisement has not loaded yet, but your article continues below.Meantime the squeeze on key commodity supplies due to conflicts in the Middle East and Ukraine is set to continue into 2027, and soaring bond yields have left governments that amassed too much debt under mounting budget pressure, Georgieva said — calling advanced economies the “worst offenders” on the latter count.SUBSCRIBER EXCLUSIVE: FP West: Energy Insider brings you behind the oilpatch’s closed doors with exclusive insights from insiders every Wednesday morning.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of FP West: Energy Insider will soon be in your inbox.We encountered an issue signing you up. Please try again“The AI building boom is inflationary. The energy and food shocks are inflationary. Tariffs, defence spending, and high public debt can be inflationary,” Georgieva said. She called for a “prudently hawkish bias” on the part of central banks, and said countries that have gotten used to running large budget deficits are in for “some very tough political choices.”The weeklong Bangkok gathering of top finance ministers and central bank governors takes place against a backdrop of turbulence in sovereign debt markets, as yields on U.S., European and Japanese bonds hit multi-decade highs. Total global debt has now surpassed US$365 trillion, according to the Institute of International Finance.“Policymakers had a relatively easy ride over the last 17 years as for all that time interest rates were stuck below GDP growth rates,” Georgieva said. “Higher interest rates now put an end to that.”This advertisement has not loaded yet, but your article continues below.By contrast, the wave of AI investment — and expectations for the economic gains it will deliver — keeps propelling stocks to new highs, and has delivered record exports for Asia’s powerhouse producers of chips and other equipment.The bond selloff got underway after the U.S. and Israel attacked Iran in February, choking off fuel supplies and raising costs worldwide. Georgieva said the energy shock has been “large but contained” so far. But she warned that “price pressures may build further as demand rises with the approach of the Northern hemisphere cold season and as countries replenish reserves.”The AI buildout is adding to energy demand, and it also risks widening economic inequalities, Georgieva said. “Growth in AI-related trade reflects the investment boom in economies embedded in its value chain,” she said, but “it largely bypasses most others.”This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.