IMF chief warns that AI risks could outweigh benefits without safeguards

14:47

By: Azzat Manal

IMF chief warns that AI risks could outweigh benefits without safeguards

International Monetary Fund (IMF) Managing Director Kristalina Georgieva has warned that artificial intelligence could pose greater risks than opportunities if governments and technology companies fail to establish appropriate safeguards and ethical principles. Speaking at the IMF and World Bank annual meetings in Bangkok on October 16, she called for a balanced approach combining industry responsibility, public engagement and cooperation among governments.

Georgieva acknowledged that AI is already contributing to economic development, with the potential to improve productivity, support innovation and transform industries. However, she cautioned that expectations surrounding the technology could create economic and financial challenges if promised productivity gains fail to materialize quickly enough. The rapid expansion of AI investment has also raised questions about market stability, particularly amid high debt levels and wider geopolitical uncertainty.

The IMF chief emphasized that access to essential infrastructure would be crucial to ensuring that the benefits of AI reach people across different countries and communities. Reliable electricity, digital connectivity and effective regulation are among the conditions needed to prevent the technology from deepening existing economic inequalities. She also stressed the importance of developing safeguards at a pace that reflects the speed of technological change.

During a panel discussion featuring Anthropic co-founder Jack Clark, Georgieva compared the development of AI to high-speed racing without adequate barriers, highlighting the difficulty of managing a powerful technology without clear protections. Clark agreed that practical standards were necessary to build public confidence, pointing to emerging regulatory frameworks in the European Union and voluntary industry commitments in the United States.

Clark said Anthropic tests its systems, publishes information about those evaluations and allows external experts to review aspects of its work. While he supported industry involvement in developing standards, he argued that responsible AI governance should not depend entirely on voluntary commitments. In his view, reasonable and consistent rules could help strengthen trust in the technology while allowing innovation and economic activity to continue.

Georgieva also called for countries with major AI industries, including the United States, China and India, to participate in discussions, alongside nations involved in the technology's supply chains. International institutions such as the IMF could contribute within their areas of expertise, particularly by assessing AI's implications for productivity, employment and financial stability.

The debate also revealed differing views on how the economic potential of AI should be presented. US Treasury Undersecretary Erin Browne argued that international financial institutions should give greater attention to the technology's potential to generate positive economic shocks. Meanwhile, Bank of England Governor Andrew Bailey expressed optimism about the possibility of international agreement on AI testing standards, reflecting growing interest in common approaches to evaluating increasingly advanced systems.

As governments and businesses accelerate AI development, policymakers face the challenge of balancing innovation with accountability. The discussions in Bangkok underscored the need for cooperation, transparent testing and proportionate safeguards to ensure that the technology's economic benefits can be realized while limiting potential harm to workers, financial markets and society.