ISLAMABAD: “We have looked into the impact on Gaza and West Bank, on the economies of Palestine, and it is horrendous,” said International Monetary Fund (IMF) Managing Director Kristalina Georgieva while speaking to journalist Richard Quest at the World Governments Summit in Dubai, United Arab Emirates (UAE).
In a session at the World Governments Summit, on February 12, Quest asked the IMF chief about the limited macroeconomic effect of the war in the Middle East, in response to which Georgieva said the impact for the rest of the world may be limited but that was not the case for the part of the world directly affected.
She shared that the economy in Gaza shrunk by 80 per cent and in the West Bank by 22 per cent. Additionally, for the Middle East and North Africa region, they [the IMF] had downgraded their projections from October by half a percentage point.
The IMF chief noted that there had not been “massive spillovers” for the rest of the world. “Yes, what is happening in the Suez Canal is creating a bit of anxiety because it affects supplies and we got really allergic to supply chain disruptions but not majorly.”
In response to a question about where she feared most things could get out of control, Georgieva said it was the longevity of the conflict as that would increase the risk of spillovers.
“Right now we see a risk of spillover from the Suez Canal but if there are other unintended consequences in terms of where the fighting goes, then it can become much more problematic for the world as a whole.
“So as a woman, as a mother, as a grandmother, I pray for peace for the people that are affected and for the security of all of us.”
Artificial Intelligence
The IMF chief was asked about a report that the IMF had released about Artificial Intelligence (AI) and summarized that in their report, the IMF had said that the shift to AI would be like an industrial revolution in terms of scale and significance of impact affecting 40 per cent of jobs either through new jobs emerging or old jobs disappearing.
“This is like a tsunami hitting the labor market and then we ask the question, are we ready?,” she said, adding that the IMF’s report had stated that some countries such as the UAE and Saudi Arabia were prepared while the majority of nations, primarily developing nations, were not.
Georgieva said that readiness was measured by looking at four things — digital infrastructure; skills and labor; innovation; and regulation and ethics. “Across the board, more advanced economies are in a better position. Poor countries are not,” she said.
Addressing the UAE leadership, the IMF chief commended their foresight to establish a ministry for AI in 2017.
She said what they needed to do now was to take the rest of the world with them and invest in emerging markets and developing economies to help them leapfrog.
“If we get more nations ready to benefit from this technology, but also manage its negative potential consequences — misinformation, disinformation– the more we do for others, the better off you will be.”
Discussing what she agreed to be the two greatest risks of AI, Georgieva said that the first was indeed not benefitting from AI to lift up everybody while the second was the ability of AI to create a “parallel universe of lies and misconceptions”.
She emphasized the need to “act responsibility” and revised her message to the UAE leadership to “lead the world in responsible, humanity serving adoption of artificial intelligence.”
