The war between Israel and Hamas and attacks off Yemen

The war between Israel and Hamas and attacks off Yemen threaten the global economy

The head of the International Monetary Fund (IMF) warned on Monday that the war between Israel and Hamas in the Gaza Strip and attacks by Houthi rebels off the coast of Yemen, particularly at the Suez Canal, posed a threat to the global economy.

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The war in the Gaza Strip has already put a strain on the economy of the Middle East and North Africa region, said Kristalina Georgieva at the World Government Summit in Dubai.

“I fear above all the longevity of the conflict, because if it continues, the risk of spillover increases,” she added during this annual event that brings together business and political figures in the United Arab Emirates. , which runs until Wednesday.

“Currently we see the risk of flooding of the Suez Canal,” a maritime area important for global trade, Ms. Georgieva continued, against the backdrop of attacks by Yemeni rebels on ships in the Red Sea and the Gulf of Aden. They said they were acting in “solidarity” with Hamas.

The United Nations Conference on Trade and Development (UNCTAD) warned in late January that the volume of trade through the Suez Canal had fallen by more than 40% in the past two months.

If hostilities spread, “it could become more problematic for the world as a whole,” complained Ms. Georgieva.

Challenges that need to be overcome

On October 7, Hamas commandos infiltrating from the Gaza Strip carried out an attack on Israeli soil that killed more than 1,160 people, most of them civilians, killed the same day, according to an AFP count based on official Israeli figures.

In response, Israel launched an offensive in Palestinian territory that left more than 28,300 people dead, the vast majority of them women, children and teenagers, according to the Hamas Health Ministry.

Fears of a regional escalation of the conflict between Israel and its American ally, on the one hand, and Iran-aligned armed groups supporting Hamas in Lebanon, Syria, Iraq and Yemen, on the other, are not abating.

“I expect interest rates to move towards last year's inflation by mid-year,” the IMF director said when asked about interest rate cuts in major economies.

For his part, the President of the World Bank, Ajay Banga, stated that “what is happening in Gaza, but also the challenges of Ukraine (…) and the Red Sea” are among the greatest challenges that need to be overcome for the global economy.

“When you add these variables to what is already probably the lowest growth rate in the last 55 years, we need to watch this closely,” he said at the summit.