The war in Israel and Gaza is affecting the world economy

Director Director of the International Monetary Fund (IMF), Kristalina Georgievawarned that the conflict between Israel and Hamas, in Gaza, adds “more uncertainty and risk” to already poor estimates of global growth.

“The Covid pandemic, the Russian invasion of Ukraine and climate disasters continue to grow more serious. These ‘shocks’ have contributed to a cost-of-living crisis that is hitting the poor hard, and The Israeli conflict in Gaza adds more uncertainty and risk“, he pointed out in the opening message of the forum held in Washington.

All this does Global growth is expected to slow this year and that it remains “at around 2% for the next five years”, which is “the weakest medium-term growth forecast in decades”, Georgieva reminded.

Furthermore, currently “it is difficult to reduce inflationdebt levels are near historic highs and interest rates will be high for a long time,” situations that “expose vulnerabilities in the real estate sector and other sectors.”

In this context, Georgieva pointed out, It is necessary that “monetary policy continues to focus on reducing inflation”.

“This is the right way, but represents the risk of contagion effects from advanced economies to emerging ones and challenges to financial stability. “This has been well managed so far, but continued vigilance and policy agility are key,” he said.

According to Georgieva, in the current global context, this is also important work to reduce fragmentation.

“Internal actions are simply not enough. We need trade cooperation and ensure that the poorest members of our global community have access to much-needed financing on favorable terms,” he said.

A month ago, as part of its annual assembly held in Marrakesh (Morocco)The IMF presented its latest updated global growth forecasts.

He kept his predict 3% for this yearbut in 2024 he reduced it by one tenth, to 2.9%.

The forecasts were made before the conflict broke out between Israel and Hamas so that they do not yet reflect its consequences.

On October 25, Georgieva participated in a forum known as “Davos of the desert” in Saudi Arabia.

He warned that it already exists “visible” economic impact on Israel’s neighboring countries for the war in the Gaza Strip.

“If we look at neighboring countries –Egypt, Lebanon and Jordan– the channels of influence are already visible,” said the director of the IMF.

Georgieva noted that Israel’s neighboring countries They are very dependent on tourism and that the current moment of “uncertainty” is affecting the flow of visitors, as several embassies have warned of the dangers of traveling to the region.