Speaking at the Global Policy Agenda press briefing during the 2026 IMF-World Bank Annual Meetings in Bangkok, the International Monetary Fund Managing Director Kristalina Georgieva addressed the room during the Q&A session, spanning from low-income debt distress to sovereign yield pressures, global trade imbalances, European budgetary strains, and Middle East conflict spillovers.
Responding to inquiries regarding low-income nations, Georgieva noted that while underlying debt volumes in developing countries have stabilized, debt-servicing costs have surged from 6% of government revenues a decade ago to 14% today due to elevated global interest rates. To assist vulnerable members, the IMF reformed its Poverty Reduction and Growth Trust to triple lending capacity and is actively seeking member commitments to replenish the Catastrophe Containment and Relief Trust.
On global trade and fiscal imbalances, Georgieva targeted the structural divergence between the world’s largest economies. She offered a clear tripartite prescription: China needs to spend more by shifting its growth model from export surpluses toward domestic consumption; the U.S. must save more by putting its fiscal deficit and debt accumulation on a downward trajectory over time; and Europe must invest more to boost productivity and regional competitiveness.
Addressing Thailand’s specific economic challenges, Georgieva acknowledged that elevated global interest rates and high household debt are constraining policy flexibility across Southeast Asia. The IMF chief noted that higher benchmark yields in advanced economies are establishing a higher structural floor for borrowing costs across emerging markets. To navigate these pressures and build long-term resilience, Georgieva urged Thai policymakers to fortify macroeconomic fundamentals, boost domestic growth, and capitalize on Thailand’s strategic integration within the artificial intelligence supply chain. Crucially, she called on Thailand and its regional peers to deepen intra-regional trade integration, highlighting that internal trade among ASEAN nations accounts for just 22% of total trade volume—far behind the 60% internal trade ratio within the European Union.
Turning to European fiscal concerns, Georgieva addressed France’s elevated budget deficit—projected to remain above 5% of GDP—and rising gilt yields in the UK. While expressing confidence that market access remains functional, she stressed that structural deficit reductions are mandatory across the Eurozone to reassure investors and reduce sovereign borrowing premiums. She recommended UK policymakers to stay the course to maintain financial market confidence rather than taking decisive fiscal consolidation steps.
Concluding on the geopolitical crisis in the Middle East, Georgieva expressed sympathy over recent attacks targeting facilities in Saudi Arabia, noting that conflict spillovers pose broader risks to energy markets and regional stability. However, she praised the Gulf Cooperation Council member states for their proactive structural reforms—such as Saudi Arabia’s introduction of VAT during the pandemic and non-oil diversification efforts—which created robust fiscal buffers that continue to insulate regional balance sheets from external shocks.
