The spectre of a wider conflict in the Middle East poses a fresh threat to the world economy just as it recovers from the terrific shocks of COVID-19 pandemic and the Ukraine war, finance ministers and official have warned.
Border regional tensions will have a widespread economic ramifications, they said, as they rounded off meetings with World Bank and IMF in Morocco this week. The biannual events took place as Israel declared war on Hamas and launched a major bombardment of the Gaza Strip.
Bruno Le Maire, France’s finance minister, told the Financial Times, that risks ranged from decline in confidence, to higher energy prices, which will stir up inflation.
The head of IMF, Kristalina Georgieva, warned regarding encapsulating fears among the delegates in Marrakech that the medium-term prospects for the global economy are lukewarm.
Meanwhile, Jamie Dimon, chief executive of JPMorgan, labelled the current time as the “most dangerous” the world has seen in decades.
Heading into the meetings, officials shared a sight of relief that central banks had managed to curb inflation by their monetary policies. It appeared that monetary policies by the central bank have been tightened, curbed credit growth, and cooled labour market without “overdoing it,” siad Pierre-Olivier Gourinchas, the IMF chief economist.