The International Monetary Fund (IMF) has announced in its latest report that the energy crisis resulting from the war in the Middle East is the biggest threat to the global economy. This international body has predicted that global economic growth will reach 3.4 percent next year and has emphasized the need for reconstruction and strengthening financial resilience.
Economic Challenges Arising from the Middle East War
Silvana Tenreyro, the chief economist of the IMF, stated: "The global economy has been resilient, but this resilience has reached its limits. Therefore, we need to transition from merely managing the crisis to reconstruction." She also pointed out that to rebuild resilience, there is a need to revive the financial space and strengthen the supply chain.
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The war in the Middle East has led to an increase in energy commodity prices, which has impacted the entire economy. However, government actions to mitigate the negative effects of this crisis have been somewhat effective and have managed to reduce major risks.
Economic Growth Forecast for Different Countries
Petia Kova Brookes, the deputy director of research at the Fund, stated in an interview that actions such as drawing from oil reserves and diversifying suppliers have had a positive impact. These measures have been particularly significant due to the decrease in demand caused by rising prices.
Countries that are active in artificial intelligence have a better outlook compared to those that are not. The IMF specifically mentioned countries involved in the development of AI hardware, such as South Korea, Malaysia, Thailand, and Mexico.
The economy of the United States is also receiving support due to the influence of artificial intelligence, which includes European countries in the European Union. On the other hand, more vulnerable countries facing the impacts of the energy crisis are experiencing difficult times.
According to the Fund's forecasts, Saudi Arabia will face a 3.3 percent decline in its GDP this year, which is a significant drop from the previous forecast that estimated a 1.7 percent growth for the country's economy. Other Gulf countries are also facing challenges, with Iraq, Kuwait, and Qatar expected to experience a decline of over 15 percent in GDP.
