- Published
When it comes to the future direction of the global economy there is a bit of a tug of war going on.
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it → publish → war
On the one hand holding back growth are the familiar, recurring crises from the energy shock, trade conflict and actual war.
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crises → hold → shock
This is reflected most clearly in the sharply rising interest rate costs for the world's advanced economies.
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This → reflect → economies
Pulling in the other direction is the boost from massive spending on AI, and the frankly astonishing resilience shown especially by smaller economies, as new routes for trade, including for oil and gas, have been established out of necessity.
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boost → pull → necessity
At the IMF meetings in Bangkok this week these themes came up again and again, including among those at the very top table.
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themes → come → table
But not even they know which way things are going to go.
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things → know → ?
In the meantime it's a sportsman's bet where the roving eye of the bond markets will focus next.
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eye → rove → markets
Currently they seem to be looking at the US and France.
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they → seem → US
However, the French finance minister, Roland Lescure, has been telling the world he has had no problem selling debt, though it was more expensive, and that his Budget would be fine.
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Budget → tell → debt
He also suggested he had helped save the G7 group of advanced nations, which was at risk of collapsing a year ago amid Donald Trump-inspired tensions.
uncertain
which → suggest → tensions
In some ways it is a miracle there has not been a global recession, or a debt crisis in a major emerging economy.
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it → emerge → economy
Indeed the Thai finance minister was boasting to me of how little his borrowing costs had gone up, especially in relation to the US.
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costs → boast → US
Another surprise is the UK being taken off the bond markets' naughty step, and instead being named model pupil by the IMF.
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UK → take → IMF
The IMF has taken the government's Budget plans at face value and on trust.
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IMF → take → trust
The reality is that the rest of the G7 lack even this.
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rest → lack → this
And beauty is relative, especially when it comes to borrowing.
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it → come → borrowing
And this moment gave Chancellor John Healey the chance of a hearing, to highlight that the UK's actual growth data has continued to outperform expectations and so far in 2026 can now be described as strong.
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data → give → 2026
Healey told me that he saw the figures as the first sign that AI and tech investment was starting to increase UK economic growth.
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investment → tell → growth
The bond financiers milling around the IMF meetings seem to be taking another look at the UK after years of crisis.
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financiers → mill → crisis
But there is a third big challenge to wrestle with, on top of geopolitical instability and bond market uncertainty, one that's apparent even on the streets of Bangkok, as the chauffeurs dropped off the bankers and finance ministers for this week's gathering.
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chauffeurs → be → gathering
Like other nations Thailand has experienced first hand the astonishing boom in sales of Chinese electric vehicles.
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Thailand → experience → vehicles
Thailand is sometimes dubbed the "Detroit of Asia" for its own strong car making heritage.
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Thailand → dub → heritage
It is the clearest example of what is known as the China Shock Two.
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what → know → Shock
The first China shock came in the 2000s in basic manufacturing.
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shock → come → manufacturing
This second wave of dramatic change has led in just the last few months to a reappraisal of how world trade is functioning and how it is going to be managed.
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it → lead → reappraisal
This is especially the case in the EU, which is scrambling to reassess what currently feels like a one-way street when it comes to China-Europe trade.
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it → scramble → trade
The extra "Made in Europe" protections that the bloc is drawing up will have a profound impact on the UK too.
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bloc → make → UK
If the UK is outside the new rules, China could divert its excess car production to the UK, where, like Thailand, there are currently lower tariffs and even subsidies.
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China → divert → Thailand
Or the EU could invite Britain in, but ask it to follow its suit by raising tariffs to match its own.
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EU → invite → own
This was a theme that cut through more than might have been expected in Bangkok this week and even seemed to provide a little entertainment.
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that → cut → entertainment
The managing director of the IMF Kristalina Georgieva rolled with laughter, suggesting the Brexit "divorcees are now dating again".
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divorcees → manage → laughter
The Finnish finance minister told me the UK was "flirting" with the EU.
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UK → tell → EU
Major banks were issuing reports about the prospect of "Breturn".
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banks → issue → Breturn
It is, however, the AI boom that is being relied on to provide the trampoline that is required to bounce the world economy out of its current era of multiple simultaneous crises, so many of which are linked to the decisions of President Trump.
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many → rely → Trump
But even that is not clear cut.
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that → cut → ?
In one room the transformative economic effect of AI is lionised by finance ministers.
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effect → lionise → ministers
In the next, central bankers fret about its power to break the cybersecurity of most of the banking system.
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bankers → fret → system
The financial boom around it can't last.
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boom → last → it
The Aporia
