IMF says AI investment keeps global growth around 3% but brings massive disruption

Business Recorder reported that strong investment in AI infrastructure is helping keep global growth near 3%, with large gains for Asia. IMF Managing Director Kristalina Georgieva warned at the Bangkok meetings on Monday that the technology could also upend labour markets, taxation and education. She said the boom was already lifting growth in advanced Asian economies by half to one full percentage point, and in emerging Asian economies by between 0.2 and 0.8 percentage points.

Georgieva cited IMF research suggesting that 40% of jobs will be boosted, downgraded or replaced by AI, a share reaching 60% in advanced economies. She added that the expected move from labour toward capital would reshape how governments collect tax revenue. An initial study found that 10% of US jobs already needed AI skills, while routine roles shrank and low-paid work grew in construction and data centres.

Singapore President Tharman Shanmugaratnam said governments should soon address AI reducing job openings for graduates, as demand for first jobs falls. World Bank President Ajay Banga said he was not convinced entry-level jobs would be destroyed, noting that most disruption would hit advanced economies building large AI models. The IMF is due to release an updated outlook on Tuesday, with about 18,000 people expected at the week-long meetings.