Global debt is on a rising path following trade and market turmoil, the IMF announced in the Fiscal Monitor Report released Wednesday (April 23) in Washington, DC.
“Since the last fiscal monitor in October, 2024, global economic prospects have significantly deteriorated and risks to the economic outlook are elevated and tilted to the downside. Uncertainty is very high and confidence has been weakening. Financial markets have partially corrected and financing conditions have tightened. Global public debt is very high and rising,”said IMF Director of Fiscal Affairs Department Vitor Gaspar.
The IMF sees the global economy slowing, but not yet bound for recession, a respite that could be a cushion period for governments to make spending adjustments to bring down deficits and debt.
"Putting house in order involves three policy priorities. First, fiscal policy should be part of an overall stability-oriented macroeconomic policies. Second, fiscal policies should, in most countries, aim at reducing public debt and rebuilding buffers to create space. To respond to spending pressures and other economic shocks through a credible medium-term framework. Third, fiscal policy should, together with other structural policies, aim at improving potential growth, thereby easing policy trade-offs. In these times of high uncertainty, fiscal policy must be an anchor for confidence and stability that contributes to a competitive econom,” said Gaspar to reporters gathered for the Annual Meetings of the IMF and World Bank this week.
But policy makers should look for smart ways to trim budgets, and ones that maintain equitable and fair revenue from taxes, while maintaining important investments in people, technology and infrastructure that support growth.
A full copy of the report can be found at: Fiscal Monitor
