The global economy is holding around 3% growth despite a series of shocks, but IMF Managing Director Kristalina Georgieva says persistent inflation, rising debt costs, artificial intelligence risks and geopolitical uncertainty are creating a fragile outlook for the world economy.

The global economy is showing surprising resilience, but the forces shaping its next phase are pulling in opposite directions, according to International Monetary Fund Managing Director Kristalina Georgieva, who has warned that uncertainty is becoming a defining feature of the global economic landscape.

Speaking at a fireside chat in the United Arab Emirates, Georgieva said global growth is currently hovering around 3%, describing the performance as a significant achievement given the multiple shocks the world economy has experienced.

At the same time, she cautioned that resilience should not be mistaken for the disappearance of risk. According to the IMF chief, a negative energy supply shock is weighing on the global economy, while strong investment demand linked to artificial intelligence is providing an opposing force.

“The forces that define where it is headed remain strong and pushing in opposite directions,” Georgieva said, pointing to the simultaneous drag from energy pressures and the boost from AI-related investment.

Her assessment captures an increasingly complicated global economic picture in which economies are being forced to absorb energy disruptions, persistent inflation, elevated borrowing costs and technological transformation at the same time.

Georgieva said one reason for greater optimism is the capacity of governments and institutions to respond when necessary. She pointed to emerging markets and developing economies that have strengthened their institutions over recent decades, while highlighting rapid responses to the latest energy shock.

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But the IMF chief also stressed the need for caution. “Uncertainty is the new normal,” she said, warning that the risks facing the global economy remain high even as growth continues.

One of the most immediate concerns is inflation. Georgieva said price pressures have proved stubborn and that the IMF does not expect a rapid resolution, meaning some central banks may need to maintain or increase efforts to restore price stability.

The problem, she explained, is that tighter monetary policy carries consequences beyond inflation itself. Higher interest rates increase the cost of servicing debt, placing additional pressure on governments, businesses and households already carrying elevated levels of borrowing.

Georgieva therefore renewed the IMF’s call for fiscal consolidation, arguing that governments need to take stronger action to address their fiscal positions.

“We have been warning that fiscal consolidation must take place,” she said, while noting that although there is considerable understanding of the issue, action has not yet matched the scale of the challenge.

The third major risk she identified is also one of the defining investment stories of the moment: artificial intelligence. The rapid expansion of AI investment has helped support economic activity, but Georgieva warned that the enthusiasm surrounding the technology could itself create vulnerabilities.

Invoking Amara’s Law, which holds that society tends to overestimate the impact of new technology in the short term while underestimating its long-term consequences, she argued that the risks associated with the AI boom could emerge sooner than many expect.

The concern is not that AI will fail to transform the economy. Rather, the danger lies in the financial expectations and leverage that have developed around the technology.

Georgieva pointed to the possibility of a financial shock if expectations surrounding AI investment fail to materialise as anticipated. High levels of leverage and what she described as circular financing could amplify the consequences of a sudden loss of confidence.

“If there should be a loss of confidence,” she warned, the interconnected nature of AI financing could create a feedback loop that would be difficult to manage.

Although much of the financial exposure is concentrated in the United States, Georgieva said the potential consequences extend well beyond the American economy.

The global AI supply chain includes economies across Asia, including Malaysia, Thailand, South Korea and Singapore, while Europe also plays a critical role in AI production and technology supply chains.

That interconnectedness means a financial setback in one part of the AI ecosystem could have implications for markets and economies elsewhere.

South Korea, she noted, is among the economies where potential financial effects of an AI-related disappointment are visible, particularly against the backdrop of significant movements in its stock market.

The IMF chief’s assessment therefore places AI in a broader global context: not simply as a technological revolution or investment opportunity, but as an increasingly interconnected financial phenomenon whose risks could travel across borders.

Yet amid the warnings, Georgieva also highlighted what she described as an important and underappreciated success story: the global response to the energy shock.

She credited a range of countries and regions with taking action that has helped the world economy absorb the disruption.

Nigeria and India, she said, have expanded refining capacity rapidly; the United States and Norway have increased production; Saudi Arabia and the United Arab Emirates have developed alternative routes; while European investment in renewable energy has also helped economies withstand the shock.

“We should be grateful to Nigeria and to India for expanding refinery capacity very quickly,” Georgieva said, placing the two countries among the economies whose actions have contributed to global energy resilience.

For Nigeria, the remarks offer recognition of the growing importance of domestic refining capacity in the global energy system. The country’s expanding refining capabilities are being viewed not only through the lens of domestic energy security, but also as part of a wider response to disruptions affecting international energy markets.

Georgieva’s comments also point to a broader shift in the global economy, where resilience increasingly depends on the ability of different regions to respond simultaneously to shared challenges.

The world may be more fragmented than it was previously, she acknowledged, but fragmentation has not eliminated interdependence. Economies remain connected through trade, energy, finance, technology and supply chains.

That interdependence creates vulnerabilities, but it also creates opportunities for collective responses.

For investors, policymakers and businesses, Georgieva’s message is therefore one of resilience tempered by caution. The global economy has continued to grow despite extraordinary shocks, but maintaining that momentum will require governments to address inflation and debt pressures while ensuring that the enormous investment surrounding AI does not create new financial vulnerabilities.

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The coming months will provide another test. With the IMF preparing new economic projections, Georgieva has made clear that the global economy enters the next phase with both considerable strengths and significant uncertainties.

Growth around 3% may represent resilience in a turbulent environment, but the IMF chief’s warning is that the underlying pressures cannot be ignored.

From energy and debt to artificial intelligence and inflation, the next chapter of the global economy will be shaped by how effectively governments, financial institutions and businesses navigate a world in which shocks are increasingly interconnected—and uncertainty has become a permanent part of the economic equation.