Economic Buzz: Global economy resilient, Asia?s near-term growth holding up amid trade tensions

Kenji Okamura, Deputy Managing Director of the International Monetary Fund (IMF) has stated that the global economy has so far proven to be resilient in the face of higher tariffs and other major policy shifts. This resilience, however, is largely due to temporary factors, not fundamental economic strength, and there are now signs of a slowdown. Slower growth could amplify debt risks at a time when debt levels are already high. At the same time, spending pressures are intensifying from defense needs, and demographic and technological changes. In developing countries, financing needs for development remain large with cuts in aid flows. Against this backdrop, Asia?s near-term growth has held up amid trade tensions. But the region?s successful growth model based on trade liberalization and integration into value chains faces mounting challenges. Many countries are struggling with high interest costs and refinancing needs that limit their ability to finance critical development spending and build resilience.

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