Headline
IMF Says AI Investment Is Keeping Global Growth Near 3%
Key Facts
- IMF Managing Director Kristalina Georgieva said AI infrastructure spending is helping the global economy grow by about 3% each year, even as energy prices remain high.
- She spoke in Bangkok at the start of the IMF and World Bank annual meetings.
- Asian economies that produce AI hardware, such as Thailand, are among the biggest beneficiaries.
- Advanced Asian economies could see growth rise by 0.5 to 1 percentage point; emerging Asian economies could gain 0.2 to 0.8 points.
- AI hardware and related technology products now account for more than a tenth of global trade in goods.
- Major technology companies plan to spend between $660 billion and $690 billion on AI this year.
- The IMF projected 3% global growth for 2026 in its July outlook.
- Georgieva warned that AI is a &8220;slow-moving tsunami&8221; that will transform jobs, education, and tax systems.
- About four out of ten jobs worldwide will eventually be affected; richer countries face about 60% exposure, compared with 23% in the poorest countries.
- Young people entering the labor market are likely to be hit first as routine entry-level roles disappear.
- The World Bank is supporting small AI tools for farmers, health systems, and teachers in emerging markets.
- The IMF has also flagged financial stability risks from advanced AI models.
AI Investment Becomes a Pillar of Global Growth
The International Monetary Fund has placed artificial intelligence at the center of its latest assessment of the world economy. According to IMF Managing Director Kristalina Georgieva, spending on AI infrastructure is now a major reason why global growth is holding near 3% annually, even as energy prices remain elevated and geopolitical tensions continue to weigh on trade and investment. The Fund's view is that the AI boom is not merely a stock-market story or a Silicon Valley obsession. It has become a broad economic force, shaping industrial production, cross-border trade, and national growth trajectories.
Georgieva made the comments in Bangkok at the opening of the IMF and World Bank annual meetings. The setting was significant. Southeast Asia sits at the heart of the global electronics supply chain, and several Asian economies are deeply integrated into the production of semiconductors, servers, networking equipment, and robotics. For these countries, the AI investment cycle is not a distant technological trend. It is a source of export revenue, factory orders, and skilled employment.
Why Asia Is the Biggest Winner
The IMF chief singled out Asian economies that produce AI hardware as the clearest beneficiaries. Thailand, for example, has become an important node in the regional electronics and semiconductor supply chain. Other advanced Asian economies could see their growth rates rise by 0.5 to 1 percentage point because of AI-related demand. Emerging Asian economies might gain a smaller but still meaningful 0.2 to 0.8 percentage points. These estimates underline how unevenly the gains from AI are distributed. Countries that make the physical building blocks of AI are capturing immediate economic benefits, while countries that mainly consume AI services may see a different mix of opportunities and disruptions.
The scale of this trade is striking. In a speech in Singapore last week, Georgieva said AI hardware and related technology products now account for more than a tenth of global trade in goods. That share reflects the enormous volume of chips, chip-making equipment, servers, and robots moving across borders. Apart from the United States, China, and India, most of the leading countries in this trade are Asian suppliers. Their factories, ports, and engineering talent are central to the global AI build-out.
The Scale of the AI Trade
The numbers behind the AI boom are difficult to ignore. Major technology companies plan to spend between $660 billion and $690 billion on AI this year. That level of capital expenditure covers data centers, advanced chips, cooling systems, power infrastructure, and software platforms. It also creates demand for specialized components and manufacturing equipment that few countries can produce at scale. The result is a concentrated but powerful export engine for economies that have spent decades building electronics and semiconductor clusters.
In its July outlook, the IMF said AI demand is boosting tech-exporting countries, while conflicts are affecting energy importers. The Fund also predicted 3% growth for 2026. That forecast suggests the global economy is settling into a moderate expansion, neither booming nor collapsing. AI investment is one of the few forces strong enough to offset higher energy costs, tighter financial conditions, and regional instability. Without it, global growth might be noticeably weaker.
A Slow-Moving Tsunami for Jobs
Georgieva did not present AI as an unqualified good. She described it as a &8220;slow-moving tsunami&8221; that will transform jobs, education, and how governments collect taxes. The metaphor captures both the gradual nature of the change and its potentially sweeping impact. AI adoption may not arrive everywhere at once, but when it does, it can reshape entire occupations and industries. According to the Fund, AI will eventually affect about four out of ten jobs worldwide. Some roles will be improved by AI tools, becoming more productive and creative. Others will be made worse, deskilled, or rendered unnecessary.
The distribution of that impact is not equal. Georgieva said richer countries are most exposed, with about 60% of jobs affected, compared with 23% in the poorest countries. This may seem counterintuitive. Wealthier economies have more resources to adapt, but they also have more jobs that involve cognitive tasks, data processing, and routine office work, which are precisely the areas where AI can substitute or augment labor. Poorer countries have a larger share of informal and manual work, which may be harder to automate in the near term. Yet lower exposure does not mean safety. It often means less capacity to invest in retraining, digital infrastructure, and social protection.
Young Workers and the First Rung
Young people entering the job market face the first hit, according to Georgieva. The routine roles they usually start in are disappearing. Entry-level positions in administration, customer service, basic analysis, and junior coding are increasingly being automated or compressed by AI systems. This creates a painful paradox: new graduates need experience to get better jobs, but the traditional first rung of the career ladder is narrowing. If that rung vanishes, the transition from education to employment becomes longer and more uncertain.
Singapore's President Tharman Shanmugaratnam, speaking on the same panel, reinforced that concern. He said the first rung in employment, the first job upon graduation, is now seeing less demand. Tharman also warned that if governments do not act, AI could increase the gap in growth and jobs between wealthy and developing countries. The risk is a two-speed world: one group of economies captures the productivity gains and export opportunities of AI, while another struggles to adapt, losing jobs and tax revenue without the means to build new industries.
Policy Choices and the Risk of Divergence
The policy implications are broad. Governments may need to rethink education systems so that students learn to work alongside AI rather than compete with it. They may need to expand mid-career retraining, strengthen social safety nets, and adjust tax systems as AI changes where value is created and how incomes are earned. Georgieva's reference to tax collection is important. If AI reduces reliance on human labor in some sectors, payroll and income tax bases could erode. Countries may need new ways to fund public services, possibly by taxing capital, consumption, or digital activity more effectively.
There is also a competitive dimension. Countries that attract AI investment, build data centers, and train AI talent may pull ahead. Those that lack reliable electricity, internet access, or regulatory clarity may fall further behind. The IMF's warnings about divergence are not abstract. They point to a future in which AI amplifies existing inequalities unless deliberate policies intervene. The technology itself does not guarantee inclusive growth. Institutions, infrastructure, and education determine who benefits.
World Bank Bets on Small AI Tools
Ajay Banga, the head of the World Bank, offered a complementary perspective. He said the bank is supporting small AI tools that do not rely on large language models. These tools are designed to help farmers, health systems, and teachers in emerging markets. The approach is pragmatic. Instead of chasing the largest and most expensive AI systems, the World Bank is focusing on narrow applications that can solve specific problems: crop disease detection, patient triage, personalized tutoring, and local-language advisory services.
Small AI tools can run on modest hardware, use less energy, and require less data than frontier models. That makes them more suitable for low-resource settings. They may not generate headlines, but they can improve productivity and public services in places where traditional infrastructure is weak. If scaled responsibly, these tools could help developing countries capture some of AI's benefits without waiting for the same level of investment as wealthy nations.
Financial Stability Risks and Upcoming Forecasts
The IMF has also pointed out risks from the AI boom. In June, Georgieva warned that Mythos-class AI models could be used to attack the financial system. The concern is that highly capable AI systems could enable faster, more sophisticated cyberattacks, market manipulation, or automated fraud. Financial institutions are already investing heavily in AI for trading, risk management, and customer service. The same tools that improve efficiency could also create new vulnerabilities if they are not properly governed.
For now, the IMF's central message is that AI investment is supporting global growth near 3%, with Asia's hardware exporters capturing a disproportionate share of the gains. At the same time, the Fund is warning that the labor-market and distributional effects could be profound. The next test comes on Tuesday, when the IMF releases its updated growth forecasts. Those numbers will show whether the AI investment cycle is continuing to offset the world economy's many headwinds, and whether the benefits are spreading beyond the countries that build the hardware.