There is a risk of a return to the Great Depression, Kristalina Georgieva warned
The head of the International Monetary Fund has warned that the global economy risks a return to the Great Depression, caused by inequality and financial sector instability. According to Georgieva, quoted by The Guardian, a similar trend is already underway. She cited a comparative analysis of the IMF between the global economy now and the situation in the 1920s that ended in a market crash.
Georgieva emphasized pay inequality: "In the UK, for example, the richest 10% of the population now controls as much as the poorer 50% of the population. The situation is similar in other countries of the Organization for Economic Co-operation and Development. "
Other problems that Georgieva points out to include strengthening trade protectionism. It further contributes to the increase of social and financial markets uncertainty. "If I have to determine a common indicator for the coming decade, it will be increasing uncertainty," Georgieva said.
She stated that new topics such as climate problems and increased trade protectionism mean that the next 10 years are likely to be characterized by social unrest and volatility in the financial markets.
"If I have to identify a topic at the beginning of the new decade, it will be increasing uncertainty," the IMF head noted.
For the still raging disputes between the US and Europe, Georgieva says that "the world trade system needs a significant upgrading."
According to her global investors' access to the financial markets of India and China in the 1990s helped bring millions of people out of poverty.