Artificial intelligence will affect 60% of jobs in advanced economies, says International Monetary Fund head Kristalina Georgieva.

The International Monetary Fund is set to publish its updated economic forecasts later this month (File)

The head of the International Monetary Fund told AFP that artificial intelligence poses risks to job security around the world, but it also provides a “tremendous opportunity” to boost flagging productivity levels and boost global growth.

Artificial intelligence will impact 60% of jobs in advanced economies, Kristalina Georgieva, executive director of the International Monetary Fund, said in an interview in Washington, shortly before she left for the annual World Economic Forum in Davos, Switzerland.

With artificial intelligence expected to have less impact in developing countries, about 40 percent of jobs globally are likely to be affected, she said, citing a new International Monetary Fund report.

“The more high-skilled jobs there are, the greater the impact,” she added.

However, an IMF report published Sunday evening suggests that only half of the jobs affected by AI will be negatively affected; The rest may actually benefit from improved productivity gains thanks to AI.

“Your job might disappear completely — it's not a good one — or AI might enhance your job, so you'll actually be more productive and your income level might go up,” Georgieva said.

Varying effects

The IMF report predicted that although labor markets in emerging markets and developing economies will see a smaller initial impact from AI, they are also less likely to benefit from the enhanced productivity that will arise from its integration into the workplace.

“We must focus on helping low-income countries in particular move faster so that we can seize the opportunities that artificial intelligence will provide,” Georgieva told AFP.

“So AI, yes, is a little scary. But it's also a huge opportunity for everyone,” she said.

She added that the International Monetary Fund is scheduled to publish updated economic forecasts later this month that will show that the global economy is broadly on track to meet its previous forecasts.

She said that the economy is “prepared for a soft landing,” adding that “monetary policy is doing a good job, inflation is falling, but the mission is not complete yet.”

“So we're in this most difficult place where we're not easing too quickly or too slowly,” she said.

The global economy could benefit from the productivity boost associated with artificial intelligence, as the International Monetary Fund expects growth to continue at historically low levels in the medium term.

“Oh my God, how much we need her,” Georgieva said. “Unless we figure out a way to unlock productivity, we as a world don't want to achieve a great story.”

A “difficult” year ahead

Georgieva said that 2024 is likely to be a “very difficult year” for fiscal policy around the world, as countries look to address debt burdens accumulated during the Covid-19 pandemic, and rebuild depleted reserves.

Billions of people are also set to go to the polls this year, putting additional pressure on governments to either increase spending or cut taxes to win popular support.

“About 80 countries will hold elections, and we know what happens with pressure on spending during election cycles,” she added.

Georgieva said what is worrying at the IMF is that governments around the world are spending large sums of money this year and undermining their hard-earned progress in combating high inflation.

“If monetary policy is tightened and fiscal policy expands, inconsistent with the goal of lowering inflation, we may be in for a longer ride,” she added.

– Focus on work –

Georgieva, whose five-year term at the helm of the International Monetary Fund is scheduled to end this year, declined to reveal whether she intends to run for a second term at the helm of the international financial institution.

“I have a job to do now, and my focus is on doing that job,” she said.

She continued: “It has been a tremendous honor to be head of the International Monetary Fund during a very turbulent period, and I can tell you that I am very proud of the way the institution has handled it.”

“But let me do what's in front of me now.”

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