IMF Chief Defies Trump Trade War Fears: "Trade Finds a Way Around Obstacles

IMF Chief Dismisses Impact of Trump Trade War: "Trade is Like Water" WASHINGTON, D.C. - Kristalina Georgieva, managing director of the International Monetary Fund (IMF), downplayed concerns about the escalating trade war between the United States and China on Friday, saying fears that trade is dead are overblown. Speaking at Fortune's Most Powerful Women 2025 summit in Washington, D.C., Georgieva emphasized that trade is a resilient force that can adapt to obstacles. "Trade is like water," she explained. "You put an obstacle in its way, and it goes around it." The comments came as President Donald Trump threatened a retaliatory 100 tariff on China's new export controls, which he described as "extraordinarily aggressive and hostile." However, Georgieva dismissed the notion that the trade war would have a significant impact on global cooperation. "This thing that trade is dead is completely overstated," she told Fortune's Diane Brady. "Trade has been around for centuries, and it will continue to be an essential part of international relations." The IMF chief's comments were in line with her organization's stance on the trade war. In a recent report, the IMF noted that while the dispute between the U.S. and China had caused some disruptions, its overall impact on global trade was expected to be limited. Georgieva's remarks also reflected the views of many economists who have argued that trade wars are unlikely to achieve their intended goals of protecting domestic industries or creating jobs. Instead, they often lead to higher prices for consumers and reduced economic growth. The IMF chief's comments were seen as a reassurance to investors and policymakers around the world, who had been worried about the potential consequences of the trade war on global markets. In the aftermath of Trump's comments, U.S. stock markets initially plummeted but later recovered as the President sought to deescalate the situation. The S&P 500 index closed down 1.4% before rebounding to a gain of 0.6%. Georgieva's words of caution were echoed by other international leaders who have expressed concerns about the potential consequences of the trade war on global cooperation. "The world needs more cooperation, not less," said European Commission President Jean-Claude Juncker in a statement earlier this week. "We must work together to address our differences and find solutions that benefit all parties involved." As the situation continues to unfold, investors and policymakers will be closely watching for any further developments on the trade front. In related news, the IMF has announced plans to hold an emergency meeting next month to discuss the impact of the trade war on global markets. The meeting is expected to bring together top officials from around the world to assess the situation and explore potential solutions. The IMF's stance on the trade war reflects its commitment to promoting international cooperation and stability in the face of uncertainty. As Georgieva noted, "Trade is a powerful force that can help us overcome our differences and achieve common goals." *Reporting by Fortune.*