BANGKOK: Strong investment in artificial intelligence (AI) infrastructure is helping sustain global economic growth at around 3 per cent, with significant benefits for Asia. However, the technology could also trigger a “slow-moving tsunami” that disrupts labour markets, taxation and education, International Monetary Fund (IMF) Managing Director Kristalina Georgieva warned on Monday.
Georgieva said the AI investment boom was creating a major demand and investment shock. It could boost growth in advanced Asian economies by 0.5 to 1 percentage point and in emerging Asian economies by 0.2 to 0.8 percentage point.
“AI, love it, hate it. It’s already here,” she said.
The shift towards AI investment is helping the global economy maintain growth of around 3 per cent despite an energy supply shock, Georgieva told hundreds of participants on the opening day of the IMF and World Bank’s week-long meetings in the Thai capital.
The IMF projected global growth at 3 per cent for 2026 in July. The organisation is scheduled to release an updated economic outlook on Tuesday.
AI Could Affect 40% of Jobs Worldwide
Georgieva said IMF research indicates that around 40 per cent of jobs worldwide could be affected by AI through changes in responsibilities, reduced job quality or outright elimination. The share could reach 60 per cent in advanced economies.
She warned that these changes would have far-reaching consequences for employment, economic growth and education.
Governments could also face challenges in collecting taxes as economic activity shifts from labour towards capital.
An initial study found that 10 per cent of jobs in the United States already required AI skills. Meanwhile, routine and repetitive jobs were declining, while lower-paid employment was growing in sectors such as construction and data centres.
Georgieva described AI as a transformative technology that was changing how people work and live. She also shared how an AI assistant now provides her with a 30-second summary of her daily schedule each morning.
The United States, China and India are major producers across the AI supply chain. However, many companies supplying the hardware needed to build AI infrastructure are based in Asia, she noted.
Singapore President Warns of Fewer Graduate Jobs
Singapore President Tharman Shanmugaratnam, who spoke at the same event, urged governments to address declining demand for entry-level workers as AI adoption expands.
“There is a particular problem that we have to address very soon … and that is that, the first rung in employment, your first job upon graduation, is now seeing less demand,” he said.
He also warned that AI could widen the economic divide between advanced and developing economies.
“AI is going to widen the divergence if we are too passive about it,” Tharman said.
He called for governments to use AI to create quality jobs and help workers progress in their careers despite technological changes.
World Bank Backs Practical AI Applications
World Bank President Ajay Banga offered a more measured view of AI’s potential impact on entry-level employment. He said he was not convinced that the technology would eliminate such jobs altogether.
Banga suggested that much of the disruption could occur in advanced economies developing large AI models.
“In the emerging markets, we are not into large language models,” he said.
Instead, the World Bank is focusing on smaller AI applications that require less computing power but can improve productivity in areas such as farming, healthcare and education.
IMF and World Bank Meetings Draw Global Officials
Around 18,000 people are expected to attend this week’s gathering, including finance officials representing the IMF’s 191 members.
However, several finance ministers are expected to miss the meetings to focus on domestic priorities. Those named in the report include US Treasury Secretary Scott Bessent and Spanish Finance Minister Arcadi España.
Finance ministers from Canada, India and the Democratic Republic of Congo are also expected to be absent, according to a source familiar with the plans. The Democratic Republic of Congo is facing an Ebola outbreak that the report said had killed at least 4,000 people.
Saudi Finance Minister Mohammed Al-Jadaan, who heads the IMF’s steering committee, still planned to attend despite the suspension of operations at Riyadh airport following deadly weekend attacks attributed to Yemen’s Iran-aligned Houthis, two sources said.
The discussions in Bangkok come as policymakers weigh AI’s potential to increase productivity and economic growth against its possible effects on employment, public finances and inequality.
