Kristalina Georgieva, the Head of the International Monetary Fund (IMF), has voiced her confidence in the evolution of the global economy. Speaking at the World Governments Summit in Dubai on Sunday, she acknowledged the presence of risks stemming from wars and the geopolitical landscape.
Despite these potential pitfalls, Georgieva noted that the global economy has demonstrated a surprising resilience. However, she also cautioned that the Gaza war could have a broader impact on the global economic situation.
“The world is grappling with an extraordinary level of uncertainty that is exacerbating the challenges for economies already striving to recover from earlier shocks. An escalation of the conflict would only compound the economic toll,” she explained.
Recent downgrading of growth forecast for the Middle East by IMF
It’s worth noting that the IMF has recently revised its growth forecast for the Middle East and North Africa region downwards to 2.9 percent. This is a 0.5 percentage points reduction from the projection made in October.
The international financial institution underscored that the economic outlook for the region is shrouded in significant uncertainty, with a multitude of risks looming large. This includes potential fallout from the escalating conflict in the Gaza Strip impacting Israel’s neighbouring countries. Additionally, the trade disruptions triggered by violence in the Red Sea could inflict serious repercussions, including adversely affecting the tourism industry.