Latest news with #Gaspar
IOL News
24-04-2025
- Business
- IOL News
IMF warns of soaring global debt levels as countries face tough economic choices
IMF Director for Fiscal Affairs Department, Vitor Gaspar; flanked by Deputy Director for Fiscal Affairs Department, Era Dabla-Norris; and Davide Furceri, Division Chief for Fiscal Affairs Department during the released of the IMF's Fiscal Monitor report in Washington D.C. on Wednesday. The International Monetary Fund (IMF) has issued a stark warning that over one-third of countries are set to experience an increase in public debt by 2025, compared to the previous year. The concerns arise amidst escalating uncertainties and significant policy shifts that are altering economic and fiscal landscapes globally.. According to the IMF's Fiscal Monitor report released on Wednesday, these economies collectively represent about 75% of global GDP and included major players— China and the United States—as well as Australia, Brazil, France, Germany, Indonesia, Italy, Mexico, Russia, Saudi Arabia, South Africa, and the United Kingdom. The Fiscal Monitor projects global public debt to increase by 2.8 percentage points this year—more than twice the estimate for 2024—pushing debt levels above 95% of world gross domestic product. Vitor Gaspar, IMF director for the fiscal affairs department, said global public debt was high and rising. Gaspar said policymakers were facing tough tradeoffs between reducing debt, meeting urgent spending needs and maintaining growth. She said getting fiscal policy right was essential at a time of heightened uncertainty. 'Debt risks were already elevated. According to the Fiscal Monitor's debt-at-risk, which utilizes data up to December 2024, in a severely adverse scenario global public debt could reach 117% of GDP by 2027. This would represent the highest level since World War II, exceeding reference projections by almost 20 percentage points,' Gaspar said. 'Risks to the fiscal outlook have further intensified. Debt levels may rise even further than the debt-at-risk estimates if revenues and economic output decline more significantly than current forecasts due to increased tariffs and weakened growth prospects. 'Additionally, escalating geoeconomic uncertainties could heighten debt risks, driving up public debt through increased expenditures, particularly in defense. Demands for fiscal support could also rise for those vulnerable to severe disruptions from trade shocks, pushing up spending.' Global public debt projections have been revised upwards, while tariffs, uncertainty and market volatility, increased defense spending, and challenging foreign aid are intensifying risks. The Fiscal Monitor estimates that a significant rise in geoeconomic uncertainty could lead to a public debt increase of approximately 4.5% of GDP in the medium term. Gaspar said countries must implement gradual fiscal adjustments within credible medium-term frameworks to reduce debt and build buffers against heightened uncertainty. She said reforms to major expenditure programs, such as energy subsidies and pensions, were crucial to reducing fiscal vulnerabilities while fostering growth. 'Countries with limited room in government budgets should implement gradual and credible consolidation plans and allow automatic stabilizers, like unemployment benefits, to work effectively,' Gaspar said. 'Any new spending needs should be offset by spending cuts elsewhere or new revenues. For countries with greater fiscal flexibility, it is important to utilize available resources judiciously within well-defined medium-term plans. Fiscal support for businesses and communities impacted by severe trade dislocations should be both temporary and targeted, with a strong emphasis on transparency and effective cost management. 'Additionally, fiscal policy, alongside other structural policies, should focus on enhancing potential growth. This can help ease challenging tradeoffs between growth and debt sustainability. For instance, well-designed pensions and energy subsidy reforms can generate savings that can be used to support social programs and infrastructure investments.' BUSINESS REPORT
Gulf Today
23-04-2025
- Business
- Gulf Today
IMF warns of ‘intensified' risks to public finances amid trade war
Donald Trump's tariff plans have increased the risks to public finances, the International Monetary Fund said Wednesday, warning countries to get their spending plans under control and prepare for 'sharper' trade-offs. The US president's on-again, off-again introduction of levies against top trading partners has sent market volatility soaring and unnerved investors, who are attempting to chart a path through the increased uncertainty. Over the past six months, 'global economic prospects have significantly deteriorated, and risks to the economic output are elevated and tilted to the downside' Vitor Gaspar, the head of the IMF's Fiscal Affairs department, told reporters on Wednesday at the launch of the Fund's Fiscal Monitor report. The forecast for public finances was published as part of the Fund and the World Bank's Spring Meetings of global financial leaders currently under way in Washington. Under its new projections, which incorporate some -- but not all -- of the recently announced tariffs, the IMF now expects global general government debt to rise to more than 95 percent of economic output this year, and to approach 100 percent of GDP by 2030. In the forecasts, the IMF expects public debt to rise by about the same amount as the combined increases seen in 2023 and 2024, Gaspar told AFP in an interview ahead of the report's publication. 'There is a pronounced trend in public debt around the world,' he said. The IMF warned in its report that the 'heightened uncertainty' about tariffs and economic policy, combined with rising bond yields in major economies, widening spreads in emerging markets, foreign aid cuts, and increased defense spending in Europe had all complicated the global debt outlook. 'Fiscal policy now faces a sharper trade-off between reducing debt, building buffers against uncertainties and accommodating spending pressures, all amidst weaker growth prospects, higher financing costs, and heightened risks,' it added. While public spending levels may pose political challenges, the right policy can also 'be a source of confidence and support in potentially very demanding macroeconomic circumstances,' Gaspar told AFP. 'Communities may be severely affected by trade dislocations, and targeted and temporary support... could be a way forward,' he added. Different paths: The IMF expects that more than a third of the world's economies, who collectively account for 75 per cent of global GDP, will see a rise in indebtedness this year. This includes many of the world's largest economies, including the United States, China, Germany, Britain, and France. But these countries will face very different realities when it comes to handling that debt, Gaspar said in the interview. 'Both China and the United States are continental economies,' he said. 'They have a space that other economies don't have.' 'The United States has an ample set of options, both on the revenue side and on the spending side, that it can deploy to control the deficit, stabilise the level of public debt and decrease the level of public debt, if it chooses to do so,' he added. 'How it's going to happen depends on... the choices made in the context of the US political system,' he said. For China, Gaspar noted that the authorities would 'eventually' need to tackle its public debt, but should focus their attention at this moment in time on providing targeted support to transform the economy. Agence France-Presse
Time of India
23-04-2025
- Business
- Time of India
IMF warns of 'intensified' risks to public finances amid US trade war
Donald Trump's tariff plans have increased the risks to public finances, the International Monetary Fund said Wednesday, warning countries to get their spending plans under control and prepare for "sharper" trade-offs. The US president's on-again, off-again introduction of levies against top trading partners has sent market volatility soaring and unnerved investors, who are attempting to chart a path through the increased uncertainty. Over the past six months, "global economic prospects have significantly deteriorated, and risks to the economic output are elevated and tilted to the downside" Vitor Gaspar, the head of the IMF's Fiscal Affairs department, told reporters on Wednesday at the launch of the Fund's Fiscal Monitor report. The forecast for public finances was published as part of the Fund and the World Bank's Spring Meetings of global financial leaders currently under way in Washington. Under its new projections, which incorporate some -- but not all -- of the recently announced tariffs, the IMF now expects global general government debt to rise to more than 95 percent of economic output this year, and to approach 100 percent of GDP by 2030. Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Google Brain Co-Founder Andrew Ng, Recommends: Read These 5 Books And Turn Your Life Around Blinkist: Andrew Ng's Reading List Undo In the forecasts, the IMF expects public debt to rise by about the same amount as the combined increases seen in 2023 and 2024, Gaspar told AFP in an interview ahead of the report's publication. "There is a pronounced trend in public debt around the world," he said. 'Heightened uncertainty' The IMF warned in its report that the "heightened uncertainty" about tariffs and economic policy, combined with rising bond yields in major economies, widening spreads in emerging markets, foreign aid cuts, and increased defense spending in Europe had all complicated the global debt outlook. "Fiscal policy now faces a sharper trade-off between reducing debt, building buffers against uncertainties and accommodating spending pressures, all amidst weaker growth prospects, higher financing costs, and heightened risks," it added. While public spending levels may pose political challenges, the right policy can also "be a source of confidence and support in potentially very demanding macroeconomic circumstances," Gaspar told AFP. "Communities may be severely affected by trade dislocations, and targeted and temporary support... could be a way forward," he added. Different paths The IMF expects that more than a third of the world's economies, who collectively account for 75 percent of global GDP, will see a rise in indebtedness this year. This includes many of the world's largest economies, including the United States, China, Germany, Britain, and France. But these countries will face very different realities when it comes to handling that debt, Gaspar said in the interview. "Both China and the United States are continental economies," he said. "They have a space that other economies don't have." "The United States has an ample set of options, both on the revenue side and on the spending side, that it can deploy to control the deficit, stabilize the level of public debt and decrease the level of public debt, if it chooses to do so," he added. "How it's going to happen depends on... the choices made in the context of the US political system," he said. For China, Gaspar noted that the authorities would "eventually" need to tackle its public debt, but should focus their attention at this moment in time on providing targeted support to transform the economy. "Fiscal support in China is welcome right now," he said. "It is something that helps rebalancing China growth towards the domestic economy." "By doing so, it helps reduce the external imbalance." Stay informed with the latest business news, updates on bank holidays and public holidays . Master Value & Valuation with ET! Learn to invest smartly & decode financials. Limited seats at 33% off – Enroll now!
Time of India
23-04-2025
- Business
- Time of India
IMF warns of 'intensified' risks to public finances amid US trade war
Washington: Donald Trump 's tariff plans have increased the risks to public finances, the International Monetary Fund said Wednesday, warning countries to get their spending plans under control and prepare for "sharper" trade-offs. The US president's on-again, off-again introduction of levies against top trading partners has sent market volatility soaring and unnerved investors, who are attempting to chart a path through the increased uncertainty. Over the past six months, "global economic prospects have significantly deteriorated, and risks to the economic output are elevated and tilted to the downside" Vitor Gaspar, the head of the IMF 's Fiscal Affairs department, told reporters on Wednesday at the launch of the Fund's Fiscal Monitor report. 5 5 Next Stay Playback speed 1x Normal Back 0.25x 0.5x 1x Normal 1.5x 2x 5 5 / Skip Ads by by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Pílula anti-calvície cresce 570 fios por dia nas entradas da careca Dê Fim à Calvície Undo The forecast for public finances was published as part of the Fund and the World Bank's Spring Meetings of global financial leaders currently under way in Washington. Under its new projections, which incorporate some -- but not all -- of the recently announced tariffs, the IMF now expects global general government debt to rise to more than 95 percent of economic output this year, and to approach 100 percent of GDP by 2030. Live Events In the forecasts, the IMF expects public debt to rise by about the same amount as the combined increases seen in 2023 and 2024, Gaspar told AFP in an interview ahead of the report's publication. "There is a pronounced trend in public debt around the world," he said. - 'Heightened uncertainty' - The IMF warned in its report that the "heightened uncertainty" about tariffs and economic policy, combined with rising bond yields in major economies, widening spreads in emerging markets, foreign aid cuts, and increased defense spending in Europe had all complicated the global debt outlook. "Fiscal policy now faces a sharper trade-off between reducing debt, building buffers against uncertainties and accommodating spending pressures, all amidst weaker growth prospects, higher financing costs, and heightened risks," it added. While public spending levels may pose political challenges, the right policy can also "be a source of confidence and support in potentially very demanding macroeconomic circumstances," Gaspar told AFP. "Communities may be severely affected by trade dislocations, and targeted and temporary support... could be a way forward," he added. - Different paths - The IMF expects that more than a third of the world's economies, who collectively account for 75 percent of global GDP, will see a rise in indebtedness this year. This includes many of the world's largest economies, including the United States, China, Germany, Britain, and France. But these countries will face very different realities when it comes to handling that debt, Gaspar said in the interview. "Both China and the United States are continental economies," he said. "They have a space that other economies don't have." "The United States has an ample set of options, both on the revenue side and on the spending side, that it can deploy to control the deficit, stabilize the level of public debt and decrease the level of public debt, if it chooses to do so," he added. "How it's going to happen depends on... the choices made in the context of the US political system," he said. For China, Gaspar noted that the authorities would "eventually" need to tackle its public debt, but should focus their attention at this moment in time on providing targeted support to transform the economy. "Fiscal support in China is welcome right now," he said. "It is something that helps rebalancing China growth towards the domestic economy." "By doing so, it helps reduce the external imbalance."
Int'l Business Times
23-04-2025
- Business
- Int'l Business Times
IMF Warns Of 'Intensified' Risks To Outlook For Public Finances
Donald Trump's tariff plans have increased the risks to public finances, the International Monetary Fund said Wednesday, warning countries to get their spending plans under control and prepare for "sharper" trade-offs. The US President's on-again, off-again introduction of levies against top trading partners sent market volatility soaring and unnerved investors, who are attempting to chart a path through the increased uncertainty caused by the manner of the rollout. "Risks to the fiscal outlook have intensified" over the past six months, the IMF said in its semiannual Fiscal Monitor report published as part of the Fund and the World Bank's Spring Meetings of global financial leaders in Washington. Under its new projections, which incorporate some -- but not all -- of the recently announced tariffs, the IMF now expects global general government debt to rise to more than 95 percent of economic output this year, and to approach 100 percent of GDP by 2030. In the forecasts, the IMF expects public debt to rise by about the same amount as the combined increases seen in 2023 and 2024, Vitor Gaspar, the head of the Fund's Fiscal Affairs department, told AFP. "There is a pronounced trend in public debt around the world," he said in an interview ahead of the report's publication. The IMF warned in its report that the "heightened uncertainty" about tariffs and economic policy, combined with rising bond yields in major economies, widening spreads in emerging markets, foreign aid cuts, and increased defense spending in Europe had all complicated the global debt outlook. "Fiscal policy now faces a sharper trade-off between reducing debt, building buffers against uncertainties and accommodating spending pressures, all amidst weaker growth prospects, higher financing costs, and heightened risks," it added. While public spending levels may pose political challenges, the right policy can also "be a source of confidence and support in potentially very demanding macroeconomic circumstances," Gaspar said. "Communities may be severely affected by trade dislocations, and targeted and temporary support... could be a way forward," he added. The IMF expects that more than a third of the world's economies, who collectively account for 75 percent of global GDP, will see a rise in indebtedness this year. This includes many of the world's largest economies, including the United States, China, Germany, Britain, and France. But these countries will face very different realities when it comes to handling that debt, Gaspar said. "Both China and the United States are continental economies," he said. "They have a space that other economies don't have." "The United States has an ample set of options, both on the revenue side and on the spending side, that it can deploy to control the deficit, stabilize the level of public debt and decrease the level of public debt, if it chooses to do so," he added. "How it's going to happen depends on... the choices made in the context of the US political system," he said. For China, Gaspar noted that the authorities would "eventually" need to tackle its public debt, but should focus their attention at this moment in time on providing targeted support to transform the economy. "Fiscal support in China is welcome right now," he said. "It is something that helps rebalancing China growth towards the domestic economy." "By doing so, it helps reducing the external imbalance."
