Finance officials gather in Bangkok for the IMF and World Bank annual meetings as the Iran war, an energy supply shock and rising interest rates threaten global growth. Public debt, particularly in developing countries, is set to be a central concern.
Finance officials will meet in Bangkok this week under a widening war in the Middle East, the biggest-ever energy supply shock and rising interest rates. The US-Israeli-led war with Iran, now in its eighth month, and its inflation impact will dominate the agenda of the IMF and World Bank meetings.
IMF Managing Director Kristalina Georgieva said 18,000 people were registered to attend, 4,000 more than at the last off-site meetings in Morocco in October 2023.
Bessent skips meetings as oil reserves are tapped
US Treasury Secretary Scott Bessent will be absent, sending two senior officials while he handles domestic engagements, a US official said. Federal Reserve Board Chairman Kevin Warsh will attend and is slated to appear at a public event with Georgieva on October 16.
Meanwhile, the Group of Seven countries agreed to release 100 million barrels of diesel and crude oil from emergency reserves. More than 1 billion barrels have been released since the war began on February 28, but industry executives say accessible stored oil is running low, which makes the market more fragile.
World Bank President Ajay Banga said global growth held up better than feared when Iran closed the Strait of Hormuz, but pressures are building again from diesel prices, fertilizer prices and a looming "super" El Niño. He said the Bank is not revising down its global forecasts at the moment.
Debt burden weighs on developing countries
Georgieva issued a similar warning in her curtain-raiser speech, telling the audience: "Winter is coming." The IMF has signaled little change in its forecast for 3% global growth in 2026.
The IMF says public debt is at its highest level since World War Two and will exceed 100% of GDP before 2030. Advanced economies, led by the United States, have the highest debt-to-GDP ratios.
Developing countries, however, face $400 billion in debt payments to external creditors in 2026, and interest payments already exceed 10% of revenue on average. Diplomats from G20 countries said there is little appetite for a suspension of debt service payments like the one announced early in the COVID crisis.
Source: Reuters via Investing.com
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