Since October, the conflict between Israel and Hamas has affected the Middle East and North Africa’s economies.
Now, it threatens global financial stability. The International Monetary Fund (IMF) and the World Bank raised this issue at the World Government Summit in Dubai.
Kristalina Georgieva of the IMF pointed out the conflict’s harmful impact on regional economies and warned of its potential spread.
She specifically mentioned the risk to the Suez Canal, vital for global trade, already targeted by attacks.
The United Nations Conference on Trade and Development (UNCTAD) noted a significant drop in Suez Canal traffic, decreasing by over 40% between November and December 2023.
This drop impacts global trade and supply chains deeply.
Ajay Banga, the World Bank President, highlighted global economic risks not just from Gaza but also from conflicts in Ukraine and the Red Sea area.
These challenges are significant hurdles for the world economy.
Global crises like the COVID-19 aftermath, the Ukraine war, the Gaza conflict, and the Red Sea tensions disrupt economic stability.
The IMF and World Bank’s warnings emphasize the need for international cooperation to protect global trade routes and ensure economic recovery.
This situation underlines the interconnected nature of global stability and the importance of resolving conflicts peacefully.