WASHINGTON (AP) — iran war Regardless of whether the fragile ceasefire holds, dark clouds are forming over the global economic outlook, the head of the International Monetary Fund warned on Thursday.
IMF Managing Director Kristalina Georgieva said the IMF will lower its outlook for the global economy next week.
“Without this shock, global economic growth would have accelerated even more,” Georgieva said in remarks ahead of next week’s IMF and World Bank spring meetings. “But now even our most hopeful scenarios include lower growth rates.”
The global economy has proven resilient in the face of President Donald Trump’s tough decisions. Last year, significant taxes were imposed on imported goods. From most countries of the world. In January, the IMF of 191 countries Global growth forecast is 3.3% And it was poised to do so again next Tuesday when new forecasts are released.
But the war that began on February 28 changed everything. The conflict has caused oil and natural gas prices to soar. Oil refineries, tanker terminals and other energy infrastructure were damaged. Shipments of fertilizer that the world’s farmers depend on will be disrupted. And it damaged the trust of businesses and consumers.
The United States and Iran announced on Tuesday that they had reached a ceasefire, after President Trump warned that otherwise “an entire civilization will perish tonight.”
Still, the IMF’s Georgieva said Thursday that “growth will slow even if the new peace persists.”
Georgieva said sub-Saharan Africa and small island states are the most vulnerable to energy shocks. Around the world, governments have limited ability to support economies by increasing spending or cutting taxes. Because government debt is already very high.
She noted that many countries have taken steps to limit the damage from energy shocks, such as encouraging or requiring people to work from home. Promote the use of public transportation. and restricting the travel of civil servants.
Georgieva urged policymakers to “be careful not to make the situation worse” with “arbitrary” moves such as export restrictions and price controls. “Don’t pour gasoline on the fire,” she said.
