The International Monetary Fund (IMF) praised the positive initial dialogue between U.S. President Donald Trump and Chinese President Xi Jinping, mentioning that reducing tensions and uncertainty between the two largest global economies would benefit the world.
“It is very important for the two largest global economies to engage in dialogue at the highest level,” said IMF spokesperson Julie Kozack. She expressed satisfaction with the constructive dialogue between the two countries, emphasizing that anything that helps reduce trade tensions and uncertainty is beneficial for both economies and the global economy as well.
The IMF has long urged the United States and China to resolve their trade disputes through dialogue rather than unilateral measures. The positive discussions between Trump and Xi on trade and investment, which were more positive a year after tariff tensions, were highlighted. Trump mentioned in a Fox News interview that China agreed to order 200 Boeing aircraft, while U.S. Treasury Secretary Scott Bessent reported discussions on energy, agricultural products, and the creation of bilateral trade and investment bodies for non-strategic sectors.
Regarding economic pressures due to the Middle East conflict and Iran’s closure of the Strait of Hormuz keeping oil prices above $100 a barrel, the IMF predicts a weaker global economic growth scenario. They estimate a 2.5% decline in global real GDP growth this year in the intermediate scenario, contrasting with the more optimistic reference forecast of 3.1% and 3.4% in 2025.
IMF General Director Kristalina Georgieva will discuss global economic issues with G7 finance ministers and central bank governors in Paris next week. The IMF is in talks for potential financial assistance to member countries facing energy and commodity price hikes due to the Middle East conflict. No specific details were provided on countries seeking aid, building on a Reuters report of Iraq requesting financial assistance.
The IMF advised against general fuel subsidies to avoid draining limited budget resources and inflating oil demand during a time of restricted supply, which would further drive prices up.
