Paris/Tokyo (Web Desk): IMF Managing Director Kristalina Georgieva has warned that the ongoing conflict in the Middle East is putting the global economy to a severe test. She stated that even if the war ends, the international economy could face long-lasting and serious challenges.
Speaking at an event in Japan, Georgieva revealed that during the conflict, key oil and gas facilities have suffered significant damage, impacting global markets. Shipping through the Strait of Hormuz, which accounts for 60% of global oil and 11% of LNG imports, has dropped by up to 90%, severely disrupting energy supplies.
She noted that the ongoing tensions have already caused oil prices to surge by up to 50%. Georgieva warned that if the conflict continues, policymakers worldwide will face unprecedented challenges, including major disruptions in global supply chains and sharply rising inflation.
The IMF chief emphasized that this crisis has emerged just as the global economy was trying to recover. The energy shortage now threatens economic stability for both developed and developing countries, raising serious concerns about global economic survival and growth.