(MENAFN- Trend News Agency) BAKU, Azerbaijan, January 24. Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), discussed global economic trends and challenges during the Global Economic Outlook panel at the World Economic Forum in Davos, Trend reports.

Georgieva revealed the IMF's updated growth projections for 2025 and 2026, noting a global growth forecast of 3.3% for this year-a slight improvement for 2025. However, she emphasized disparities in regional performance.

"Under this average number, we see very strong performance in the United States, where growth projections were upgraded significantly from 2.2% to 2.7%. Meanwhile, Europe's performance is underwhelming, and the rest of the world shows mixed results, with slight increases or decreases," Georgieva said.

Explaining the strong U.S. growth, Georgieva pointed to high productivity driven by dynamic capital markets, efficient technology adoption, and access to relatively cheap energy. "End-to-end productivity in the United States continues to grow close to 1% annually. In contrast, advanced economies have seen productivity decline from over 1% pre-pandemic to a meager 0.2% today. Emerging markets dropped from 2.5% to 0.7%, while low-income countries saw productivity fall from 2% to 0%," she noted.

Georgieva stressed the importance of addressing these disparities by focusing on productivity and capital allocation. "The world is undergoing a tremendous technological transformation. Capital must go where it can make the biggest difference. For countries to progress, they must create opportunities for entrepreneurship and ensure efficient use of capital. Europe, in particular, needs deep and unified capital markets to remain competitive," she stated.

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