AI is creating economic winners, says IMF
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The AI boom is creating a new class of shock-resistant economies.
Why it matters: Countries making the chips, servers and infrastructure behind AI are ducking the worst of the energy crises, tariffs and geopolitical turmoil.
- For decades, economists looked at income, geography and natural resources to explain which countries pulled ahead.
- AI is the new defining advantage.
Driving the news: The International Monetary Fund on Wednesday left its global growth forecast largely unchanged at 3% this year, a modest slowdown from recent years. But beneath that steady outlook, countries are diverging based on energy shocks and AI.
- Trump's declaration that the Iran ceasefire is over — and the resulting surge in oil prices — brings the IMF's biggest downside risk back into focus.
- The fund warns that a broader Middle East conflict could trigger far larger disruptions to commodity markets, supply chains and financial conditions than its baseline assumes.
The fund held its 2.3% U.S. growth forecast, saying that technology investment is offsetting geopolitical headwinds.
- Among advanced economies, the outlook is diverging. Energy exporters like the U.S. are better insulated from Iran war effects, while importers face a steeper drag — unless technology-related growth helps make up the difference.
What they're saying: "The part that did surprise us relative to April was the importance and the strength of the technology cycle, AI investment — and the benefit that brought to a number of countries," IMF economist Petya Koeva Brooks told reporters Wednesday morning.
- The global economy is being pulled by two very different forces: a war shock that's broadly felt and an AI boom that's more narrowly shared.
- "While on the one hand the war shock is affecting most countries, I think the AI technology boom is really much more concentrated in a smaller group of countries," she said.
The intrigue: The IMF says the world's top AI hardware exporters — South Korea, Taiwan, Malaysia and Thailand —beat its forecasts by an average of 4.4 percentage points in the first quarter.
- The rest of the world undershot by 0.3 percentage point.
Zoom in: South Korea's economy grew at a 7.5% annualized pace in the first quarter, more than four times the 1.8% growth the fund projected in April.
- Booming semiconductor exports overwhelmed its dependence on Middle Eastern energy imports.
- The IMF raised Vietnam's 2026 growth forecast by 0.4 percentage point, to 7.5%, citing stronger-than-expected technology exports.
The other side: Outlooks weakened for energy importers and low-income nations with less exposure to AI.
The big picture: Massive investment in chips, servers and data centers is boosting demand today, while the productivity gains that could eventually ease inflation remain in the future.
- The IMF now expects global inflation to reach 4.7% this year, up from its April forecast, before easing to 3.9% next year.
- "[T]hese projections indicate that the disinflation trend in place since the beginning of 2024 has stalled," the IMF wrote in its forecast.
- The fund says "higher demand pressures from the technology-led upturn" could require central banks to keep monetary policy tighter to avoid overheating.
The bottom line: The countries getting the biggest boost from the AI boom could also have the most at stake if the technology fails to deliver on today's lofty expectations.
