Anticipating a Drop in Global Interest Rates, IMF Director Outlines Economic Forecast

On the first day of the 2024 World Government Summit, there was a discussion featuring Kristalina Georgieva, the Managing Director of the International Monetary Fund.

The conversation was attended by His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, the Deputy Ruler of Dubai, Deputy Prime Minister and Minister of Finance, His Highness Sheikh Mohammed bin Hamad bin Mohammed Al Sharqi, Crown Prince of Fujairah, His Excellency Sheikh Mohammed bin Abdulrahman bin Jassim Al Thani, the Prime Minister and Minister of Foreign Affairs of the brotherly State of Qatar, and the Deputy Prime Minister and Minister of the Interior, His Highness Sheikh Saif bin Zayed Al Nahyan.

During the session attended by His Excellency Sheikh Nahyan bin Mubarak Al Nahyan, Minister of Tolerance and Coexistence, and His Excellency Mohammed bin Abdullah Al Gergawi, Minister of Cabinet Affairs and the Chairman of the World Government Summit, Her Excellency praised the United Arab Emirates’ readiness to utilize artificial intelligence technologies.

She highlighted the UAE’s distinction in dedicating a ministry for artificial intelligence as early as 2017, at a time when the rest of the world was still hesitant to embrace this issue.

She directed a message to the UAE, saying, “Lead the world responsibly so that humanity may rely on artificial intelligence.”

Her Excellency Kristalina Georgieva stated in the dialogue moderated by Richard Quest from CNN that the United Arab Emirates should now invest in emerging markets within developing countries to help them progress and benefit from technology.

This, in turn, would also positively reflect on the United Arab Emirates itself.

The Managing Director of the International Monetary Fund noted, “Failing to harness artificial intelligence to benefit everyone can result in a disparity that negatively impacts our future. However, enabling artificial intelligence has the potential to create a life that parallels our actual existence.

Therefore, we must act responsibly.”

She pointed out that the shift towards artificial intelligence will be similar in scale to the transformation that occurred during the Industrial Revolution. Changes in the job market are expected to occur, with as much as 40 percent of current roles potentially being impacted.

This could lead to the emergence of new job types while rendering some existing jobs obsolete.

Her Excellency Kristalina Georgieva pointed out that a report by the International Monetary Fund revealed that the United Arab Emirates and the Kingdom of Saudi Arabia are prepared for this transition, whereas some developing countries are still not ready.

Her Excellency identified four elements for assessing readiness; the first is the provision of digital infrastructure, the second is the criterion of skills and the labor market’s ability to transition from one field to another, the third is innovation and the extent to which countries invest in research and development, and the fourth concerns rules, laws, and ethics. She expressed enthusiasm for artificial intelligence, albeit with some reservations.

Kristalina Georgieva anticipates that “by mid-year, we will witness a decline in interest rates globally, while also highlighting the experiences from the pandemic period.

This makes it crucial to pay attention to and monitor events around the world, ensuring we are prepared to address and respond,” she added, “If this flexible downturn becomes a reality, rates would fall in line with our expectations.”

She added, “The United States has benefitted from being a source of energy, particularly in fuel and gas. When the war in Ukraine began, the US started exporting energy.

During the pandemic, the American administration extensively supported households and businesses, and by doing so, created assistance programs that allowed citizens to spend, thereby maintaining demand levels and a thriving job market.

Consequently, employers no longer had the ability to impose conditions as they used to in the past.”

The Managing Director of the International Monetary Fund continued, “Experience has taught us that solid economic foundations are important. These foundations are strong in the United States, rested on robust capital markets and a dynamic economy, particularly in the area of new technologies such as the seven companies leading in artificial intelligence, all originating from America. Alongside this, the United States is capable of adapting quickly, which reflects positively on the economy and attracts investments.”

It is noted that the World Government Summit 2024 will see the participation of more than 4,000 professionals from 140 governments, 85 international organizations, and 700 global companies to discuss major future global trends in more than 110 key dialogic and interactive sessions. In these sessions, 200 global figures will speak, in addition to holding over 23 ministerial meetings and executive sessions with the attendance of more than 300 ministers.

(WAM)