Israel-Hamas conflict is ‘new cloud’ darkening economic outlook: IMF chief

International Monetary Fund managing director Kristalina Georgieva on Thursday said the Israel-Hamas conflict was “heartbreaking” and threatened to darken the already tepid global economic outlook, reported Reuters.

“We are closely monitoring how the situation evolves, how it is affecting, especially oil markets,” Georgieva said.

She said there had been some fluctuations in oil prices and reactions in markets but it was too early to predict the economic impact.

“Very clearly, this is a new cloud on not the safest horizon for the world economy, a new cloud darkening this horizon – and of course, not needed,” she told a news conference at the annual meetings of the IMF and World Bank.

IMF issues Marrakech principles of global cooperation

The World Bank President Ajay Banga, IMF Managing Director Kristalina Georgieva, Morocco’s Minister of Economy and Finance Nadia Fettah, and Bank Al‑Maghrib Governor Abdellatif Jouahri released a statement on the occasion of the 2023 World Bank and IMF Annual Meetings in Marrakech on Wednesday.

“As the global community gathers in Marrakech, we need to stand together, united in the goal of protecting our future prosperity and ending extreme poverty.”

“Prospects for global growth in the medium-term are at their lowest level in decades.

The scarring effects of successive crises are increasingly apparent, just as many countries are struggling to overcome high inflation, high debt, and significant financing shortfalls to provide basic services, support infrastructure and climate action, and address rising poverty, inequality, and fragility.

“The world has become more shock-prone, with increased risks to growth, development, jobs, and living standards that widen inequalities within and across countries. Emerging market and developing economies have been especially hard hit. Income divergence with advanced economies has deepened further, and the world is not on a path to eliminate extreme poverty by 2030.

“Our understanding of the major risks and disruptive forces facing the global economy has evolved: the existential threat posed by climate change, growing disparities in income and opportunity, and geopolitical tensions are intensifying. Rapid digitalization and technological transformations create new challenges, but also opportunities, and no country should be left behind.

“Marrakech 2023 is a call for enhanced global collaborative action on common challenges, so we can build resilience and expand opportunities for a better future.”