IMF UPDATE

 

Dear MARIA,   In today's edition, we highlight: Debt transparency is a public good: Georgieva Growth in Middle East and North Africa expected to rise, but more slowly than anticipated Deutschland's denouement in F&D magazine Chart of the Week: AI needs more abundant power supplies to keep driving economic growth, and more PUBLIC DEBT Debt Transparency is a Public Good: Georgieva (Credit: IMF Photo) Global public debt is expected to approach 100 percent of global GDP by the end of the decade, while at the same time governments are wrestling with tight budgets and trade policy uncertainty. This is a problem globally, but it is particularly painful for emerging markets and developing economies, where the mounting cost of debt servicing is squeezing their ability to make investments and respond to shocks, said IMF Managing Director Kristalina Georgieva this week at the IMF Conference on Public Debt Transparency—Aligning the Law with Good Practices. Against this backdrop, debt transparency is more important than ever, Georgieva indicated. “Hidden debt inflicts real costs. It saps investor confidence. It increases borrowing costs. And it puts debt sustainability at risk, which can lead to a debt crisis. Simply put, you cannot manage what you cannot see. And this is why we need light to cut through the fog surrounding the mountain of debt. We need the right laws and requirements in both borrower and creditor countries to defer the decision-making to competent bodies so they can do what is right for debt reporting and debt management.” Read the Remarks MIDDLE EAST AND NORTH AFRICA Growth Projected to Rise, but More Slowly Than Anticipated (Credit: IMF Photo) On May 1, the IMF published the Regional Economic Outlook for the Middle East and Central Aisa: Charting a Path through the Haze. Growth is projected to rise in the Middle East and North Africa in 2025 and 2026, but at a slower pace than anticipated in the October 2024 REO. Across the region, rising trade tensions and policy uncertainty are adding to the impact of conflicts and extended oil production cuts to weaken growth prospects. Watch the launch event here.   In the Caucasus and Central Asia (CCA), growth has been robust but is set to moderate to a more sustainable pace. Policymakers must adapt to the new environment, prioritizing macroeconomic stability and accelerating structural reforms to seize global opportunities. Watch the CCA launch event here.   Learn More F&D MAGAZINE Deutschland's Denouement (Credit: iStock/gopixa) Germany’s stagnating growth and high living costs have led to much hand-wringing about what went wrong and how to move forward, including during the recent election campaign. For the first time, this introspection extends to questions about the viability of Germany’s postwar economic model itself, Christoph Rosenberg writes in a review of Kaput: The End of the German Miracle, by Wolfgang Münchau. What makes the book stand out is its astute analysis of the interplay between politicians, corporate CEOs, labor leaders, bankers, and the media, Rosenberg writes. Collectively, they produced a national obsession with a neo-mercantilist economic model that centered on exporting high-quality goods—motor vehicles, chemicals, and all kinds of mechanical hardware. Read the Review Artificial intelligence is an emerging source of productivity and economic growth that’s also reshaping employment and investment. AI has the potential to raise the average pace of annual global economic growth according to scenarios in the Fund’s recent analysis, included in the IMF’s April 2025 World Economic Outlook. AI, however, needs more and more electricity for the data centers that make it possible. The resulting strain on power grids has major implications for global electricity demand. The world’s data centers consumed as much as 500 terawatt-hours of electricity in 2023, according to the most recent full-year estimate by the Organization of the Petroleum Exporting Countries. That total, which was more than double the annual levels from 2015-19, could triple to 1,500 terawatt-hours by 2030, OPEC projects. As the Chart of the Week shows, electricity used by data centers alone, already as much as that of Germany or France, would by 2030 be comparable to that of India,  the world’s third-largest electricity user. This would also exceed the projected consumption by electric vehicles, using 1.5 times as much power as EVs by the decade’s end. Read More MARK YOUR CALENDAR MAY 18-19, 2025 IMF - MENA Research Conference The International Monetary Fund (IMF) and the Onsi Sawiris School of Business at The American University in Cairo are co-organizing the first annual IMF MENA Research Conference on May 18-19, 2025. This conference titled, "Steering Macroeconomic and Structural Policies in A Shifting Global Economic Landscape," will feature presentations by distinguished academics from around the world and the region on economic topics of regional and global relevance. For more details, and to register to attend please see IMF - MENA Inaugural Research Conference.   Learn More Thank you very much for your interest in the Weekend Read! Be sure to let us know what issues and trends we should have on our radar.    Miriam Van Dyck  Editor | IMF Weekend Read   mvandyck@IMF.org Stay connected with the International Monetary Fund: