The IMF is expected to release updated economic forecasts later this month (File)
Artificial intelligence poses risks to job security around the world, but also offers a “tremendous opportunity” to boost falling productivity and boost global growth, the IMF chief told AFP.
AI will impact 60 percent of jobs in advanced economies, International Monetary Fund Managing Director Kristalina Georgieva said in an interview in Washington, shortly before her departure for the annual World Economic Forum in Davos, Switzerland.
With AI expected to have less impact in developing countries, around “40 percent of jobs worldwide are expected to be affected,” she said, citing a new IMF report.
“And the more higher-skilled jobs you have, the greater the impact,” she added.
However, the IMF report released on Sunday evening found that only half of the jobs affected by AI will be negatively affected; The rest could actually benefit from greater productivity gains from AI.
“Your job could disappear entirely – which is not a good thing – or artificial intelligence could improve your job so that you are actually more productive and your income level could increase,” Georgieva said.
Uneven effects
The IMF report predicted that while labor markets in emerging and developing countries will initially feel a smaller impact from AI, they will also be less likely to benefit from the increased productivity that will come from integration in the workplace.
“We need to focus on helping low-income countries in particular to move faster to take advantage of the opportunities that artificial intelligence will bring,” Georgieva told AFP.
“So artificial intelligence is a bit scary. But it is also a tremendous opportunity for everyone,” she said.
The IMF will release updated economic forecasts later this month that will show the global economy is broadly on track to meet its previous forecasts, she said.
She was “ready for a soft landing,” she said, adding that “monetary policy is doing a good job, inflation is coming down, but the job is not quite done yet.”
“So we're in the toughest spot of neither easing too quickly nor too slowly,” she said.
The global economy could use an AI-driven productivity boost, with the IMF predicting it will continue to grow at historically subdued levels in the medium term.
“God, how much we need it,” Georgieva said. “Until we find a way to increase productivity, we as a world are not in for a great story.”
“Tough” year ahead of us
Georgieva said 2024 was likely to be a “very difficult year” for fiscal policies worldwide as countries try to manage debt burdens accumulated during the Covid-19 pandemic and rebuild depleted buffers.
Billions of people will vote again this year, putting additional pressure on governments to either increase spending or cut taxes to win popular support.
“About 80 countries will have elections, and we know what happens with spending pressures during election cycles,” she added.
The concern at the IMF, Georgieva said, is that governments around the world will spend heavily this year, undermining the hard-won progress they have made in combating high inflation.
“If monetary policy is tightened and fiscal policy is expanded, which goes against the goal of reducing inflation, we could be looking at a longer journey,” she added.
– Focused on work –
Georgieva, whose five-year term at the helm of the IMF ends this year, declined to comment on whether she plans to run for a second term as head of the international financial institution.
“I have a job to do right now and I’m focused on getting that job done,” she said.
“It has been a great privilege to take the helm of the IMF at a very turbulent time, and I can tell you that I am quite proud of how the institution has handled it,” she continued.
“But let me do what’s in front of me.”
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)