IMF Chief Warns US and UK Over Spiraling Debt

International Monetary Fund Managing Director Kristalina Georgieva warned advanced economies, specifically the United States and the United Kingdom, to reduce borrowing and lower debt levels. Speaking on the sidelines of the United Nations General Assembly, Georgieva stated that global economic shocks have pushed debt levels up while governments have failed to contain service costs.

Georgieva highlighted that the United States debt pile has surpassed $40 trillion, doubling over the last decade. In the United Kingdom, August borrowing reached £18.3 billion, with debt interest hitting its highest August level for that month since 1997. She attributed rising bond yields to inflation, oil supply disruptions caused by wars, and heavy capital demand from tech companies investing in artificial intelligence.

Beyond fiscal policy, Georgieva cautioned that a loss of control over AI systems could present a significant financial stability risk. To normalize the global economy, she emphasized the necessity of durable oil and gas exports from the Gulf to resolve ongoing energy supply shocks. She urged politicians to prioritize fiscal consolidation and ensure central banks maintain price stability to stabilize the global financial landscape.