Kristalina Georgieva
The Fund will lower its forecasts for global economic growth because of war in the Middle East, IMF Managing Director Kristalina Georgieva said on Thursday, warning of long-term damage to the economy even in the most optimistic scenario, Euronews writes.
“Even in the best case scenario, there will not be a net return to the status quo,” Georgieva said, citing skyrocketing energy prices, crumbling infrastructure, supply disruptions and falling confidence in markets as factors that will hold back growth no matter how the conflict unfolds.
The IMF also promises that between $20 billion (17.2 billion euros) and $50 billion (42.9 billion euros) will be allocated for emergency balance of payments support for war-affected countries. Moreover, the allocation of the smaller amount is possible only if the ceasefire regime is maintained.
Georgieva emphasized that the crisis is hitting countries unevenly, warning that poorer energy-importing states are bearing the brunt.
Global inflation forecasts are also expected to rise, driven by oil price shocks and supply chain disruptions.
A joint statement by the IMF, World Bank and World Food Programme said rising oil, gas and fertilizer prices, combined with transport bottlenecks, “will inevitably lead to higher food prices and increased food insecurity.”
