2023-10-24 12:36:12
The war between Israel and Hamas risks having ” graves » economic consequences, warned this Tuesday, October 24, the president of the World Bank, during an investors’ conference in Riyadh, Saudi Arabia. “ I think that what is happening in Israel and Gaza (…) will have a serious impact on economic development “, said Ajay Banga. Before adding: “ I think we are at a very dangerous moment ».
More than 1,400 people have been killed on Israeli territory by Hamas men, the majority civilians, since October 7, the day of the attack by the Palestinian movement carried out from Gaza, according to the Israeli authorities. Hamas also kidnapped around 220 hostages, Israelis and foreigners, according to the Israeli army.
In the Gaza Strip, more than 5,000 Palestinians, mostly civilians, have been killed in incessant bombings carried out in retaliation by the Israeli army, according to the Hamas Ministry of Health in Gaza.
Slowing growth
The president of the World Bank was speaking at the opening of the annual Future Investment Initiative conference, often called the Desert Davos “. More than 6,000 delegates are participating in the three-day forum, which will include leaders of major international banks and companies and the presidents of South Korea, Kenya and Rwanda, according to organizers.
Yasir al-Rumayyan, head of the Saudi sovereign wealth fund, made only an indirect allusion to the war between Israel and Hamas in his speech, and warned of the challenges posed by high interest rates. However, he was optimistic, emphasizing that “ even in a high interest rate environment we can see an acceleration in growth and productivity ».
The World Bank is not the only institution to be alarmed by the repercussions of the conflict in the Middle East. It’s a ” new cloud in a horizon that is already not very sunny for the world economy “, estimated at the beginning of October the general director of the International Monetary Fund (IMF), Kristalina Georgieva, for whom it is above all ” heartbreaking to see innocent civilians die ».
Beyond the already very heavy human toll, institutions are wondering about the impact that such a conflict could have on a world economy already facing its lowest growth rate in several decades, and more specifically, for one regions of North Africa and the Middle East. However, it is difficult for the moment to precisely determine the impacts, judged Kristalina Georgieva, even if the IMF “ is monitoring the situation very closely ».
« We have seen some reactions on the oil market, but it is too early to say more, we see increases and decreases one after the other “, she clarified. During the presentation of the IMF’s annual report on the world economy, its chief economist, Pierre-Olivier Gourinchas, recalled that an increase of 10 dollars in oil prices, if it was persistent, could lead to a loss of 0 .15 percentage point of global GDP.
An impact subject to the duration of the conflict
In the wake of the Hamas attack, oil jumped by five dollars, before falling slightly in the following days, as the conflict did not result in a shortage of supplies. For the IMF, the real difficulty for the world economy is that these new strong tensions come on top of the ” severe shocks » with which she has already been confronted for three years and which become “ the new norm further weakening a world already weakened by low growth and the fragmentation of its economy “, pointed out Kristalina Georgieva.
The impact on the world economy will mainly depend on the duration of the conflict, as well as its magnitude. It could be much more marked and immediate for the economy of North Africa and the Middle East, which are already suffering the economic consequences of the civil war in Sudan. In 2023, this zone should experience growth below global growth (2% compared to 3%) before increasing in 2024 to 3.4%, a potential recovery now in danger.
Certainly, an increase in oil prices would be favorable to producing countries, like Saudi Arabia, which needs a barrel of at least 80 dollars to balance its budget. But elsewhere the impact will be quite different, in particular for countries already in difficulty, such as Egypt, Lebanon or Tunisia, where budgetary margins are already low and additional support for fuel subsidies is almost impossible.
(With AFP)
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