The global economy remains robust, but geopolitical tensions increase downside risks.

■ The global economy remains robust, with the IMF's economic outlook revised upward due to a surge in AI-related spending. 

■ Whether the US-EU tariff response over Greenland can demonstrate a path to easing tensions is worth watching. 
 
The International Monetary Fund (IMF) released its World Economic Outlook on the 19th, raising its forecast for global economic growth this year. Global economic growth in 2026 is projected at 3.3%, an upward revision of 0.2 percentage points from 3.1% in October last year. By region, growth prospects for several regions, including the United States (2.4%, up 0.3 percentage points from the previous forecast), the Eurozone (1.3%, up 0.1 percentage points), Japan (0.7%, up 0.1 percentage points), and China (4.5%, up 0.3 percentage points), have all been revised upward. The main reason for this upward revision is that, although the shift in US trade policy has had a negative impact, the sharp increase in artificial intelligence (AI)-related spending in North America and Asia, along with fiscal and monetary policy support, has largely offset these adverse factors. The 20th will mark the first anniversary of President Trump's second term as US president. Last year, the sudden implementation of US tariffs plunged global trade and financial markets into severe turmoil, but the world economy remains "quite robust." This forecast also indicates that global economic growth will exceed pre-inauguration expectations. On the other hand, the IMF points out that downside risks remain more prominent, including concerns about an AI bubble, renewed trade frictions, and geopolitical tensions, all posing significant risks to the global economy. 
 
Since the beginning of the new year, geopolitical tensions have escalated rapidly. Following the US invasion of Venezuela, the developments surrounding the acquisition of Greenland have fueled concerns about renewed confrontation between the US and Europe. President Trump announced that starting February 1st, he would impose a 10% tariff on eight European countries related to Greenland, which he is seeking to acquire. In response, reports indicate that the EU is discussing the possibility of imposing tariffs on €93 billion (approximately ¥17.09 trillion) worth of US products. However, differing stances among countries on how to respond to the US leave the final actions of European nations unclear. German Chancellor Merz appears to be more cautious in response to French President Macron's advocacy for using the EU's "Anti-Coercion Instruments (ACI)" (including broad and powerful retaliatory measures such as tariffs, investment restrictions, and service sector regulations). Regarding the Ukraine issue, Europe is heavily reliant on US military support; a deterioration in relations with the US due to escalating retaliatory measures could lead to a crisis for Europe. The current hardline stance displayed by the US may accelerate Europe's process of strategic autonomy in trade and arms. At the World Economic Forum (WEF) Annual Meeting (Davos Forum), which opened on the 19th, key figures from various countries, including European Commission President Ursula von der Leyen and US Treasury Secretary Bessent, will speak on the 20th, and President Trump is scheduled to speak on the 21st. The statements made by various parties regarding US tariff policies towards Europe and the peace process in Ukraine are also attracting considerable attention. Whether a path to easing tensions can be found requires close monitoring of the actions of various countries in the coming days.