The Director General of the International Monetary Fund (IMF), Kristalina Georgieva, on Sunday called for vigilance in the context of growing risks to financial stability, Reuters reports.

The bankruptcy of the American bank Silicon Valley Bank (SVB) on March 10 raised concerns about the reliability of the banking sector in the United States and Europe. The first European victim of this crisis, the Swiss bank Credit Suisse, was bought last Sunday by rival UBS for a fraction of its value on the stock market.

“Obviously, the risks to financial stability have increased,” Kristalina Georgieva said on Sunday during the China Development Forum, an event organized in Beijing by the Chinese government, Agerpres reported.

“Politicians have taken decisive action in response to risks to financial stability. These measures succeeded to some extent in easing the tension on the market, but uncertainty is high, so we must remain vigilant,” Kristalina Georgieva added.

In his speech, the IMF director reiterated his opinion that 2023 will be a difficult year, as the growth rate of the world economy will fall below 3% due to the consequences of the pandemic, the war in Ukraine and the tightening of monetary policy. politics Even with better forecasts for 2024, global economic growth will be lower than the historical average of 3.8%, and the overall forecast is weak, Kristalina Georgieva said at the China Development Forum.

Appeal of the IMF to China

The International Monetary Fund predicts that global gross domestic product will grow by 2.9% this year, and it is set to release a new set of forecasts in April.

Georgieva also said the steady recovery of China’s economy, which is expected to register GDP growth of 5.2% in 2023, offers some hope for the global economy, as the Asian giant is expected to account for about a third of global economic growth. in 2023. According to IMF estimates, every one percentage point increase in China’s GDP results in a 0.3 percentage point increase in the GDP of other Asian countries.

In this context, Georgieva urged Chinese leaders to balance the economy by shifting from investment-based growth to consumption-based growth, including through reforms to ensure a level playing field between the private sector and state-owned companies. Such reforms could boost China’s real GDP by 2.5 percent by 2027 and by about 18 percent by 2037, Georgieva said.

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