IMF Warns: U.S. Economic Growth Cannot Quickly Resolve Debt and Deficit Issues; Additional Measures Still Needed

On October 14, the International Monetary Fund (IMF) stated that US economic growth is insufficient to quickly resolve the expanding government debt and fiscal deficit issues, and that the United States needs to take other measures to improve its fiscal situation. IMF Managing Director Kristalina Georgieva said on Wednesday during the IMF and World Bank annual meetings held in Bangkok that the US government “relies heavily on strong economic growth,” but added that while growth can provide assistance, it cannot accomplish the necessary fiscal adjustments quickly enough.

The institution believes that although higher economic growth helps improve debt burden indicators, relying solely on growth may not be sufficient to offset the pressures from high deficits, high interest expenditures, and the continually increasing scale of debt. (Jin10)