IMF Chief Argues US Cannot Rely on Economic Growth Alone to Fix High Debt and Fiscal Deficits

Deep News10-14

IMF Managing Director Kristalina Georgieva said on Wednesday that the United States cannot resolve its rising debt and fiscal deficit problems quickly enough through economic growth alone, and that additional measures are needed.

Speaking during the IMF and World Bank annual meetings in Bangkok, she said: "The US government is very much relying on strong economic growth. Growth will of course help, but it will not bring about the necessary adjustment fast enough." She added that "some measures are necessary."

US Treasury Secretary Scott Bessent holds the view that the United States can rely on strong economic growth to change the trajectory of its debt and fiscal deficits. Bessent said last week: "What matters is the debt-to-GDP ratio, and we will start to bend that curve and bring it down. That could happen quite quickly." He said that if gross domestic product continues to grow at a rate exceeding 3%, it would help achieve this goal, and the previous quarter was already on track to reach that pace. Bessent did not attend this week's IMF meetings.

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