War in Iran could increase demand for financial support from the IMF by up to US$50 billion

The managing director of the International Monetary Fund (IMF), Kristalina Georgieva, speaks during a press conference in Washington REUTERS/Mike Theiler/File Photo Demand for financial support from the International Monetary Fund (IMF) is expected to increase between US$20 billion (R$101.8 billion) and US$50 billion (R$254.5 billion) in the coming months, as an effect of the war in the Middle East, said the fund’s director general, Kristalina Georgieva, this Thursday (9). Georgieva said the war was testing the global economy, with a 13% cut in the global daily flow of oil and a 20% cut in liquefied natural gas (LNG). According to her, the scenario triggered a supply shock that caused energy prices to soar, while disrupting supply chains. 🗒️ Do you have any reporting suggestions? Send to g1 In comments prepared ahead of next week’s IMF and World Bank meetings, Georgieva said the war had led the Fund to cut its global growth forecast. United States President Donald Trump announced on Tuesday (7) a two-week ceasefire with Iran. However, Israel’s continued bombing of Lebanon threatens to derail negotiations for a permanent peace. See the trending videos on g1 See the videos that are trending on g1 “Even in the best case scenario, there will not be a pure and simple return to the status quo ante,” Georgieva said. The Ras Laffan complex in Qatar, which produces 93% of the Persian Gulf’s LNG, for example, has been closed since March 2 and could take three to five years to return to full capacity. “The fact is that we don’t really know what the future holds for the passage of ships through the Strait of Hormuz, nor, for that matter, for the recovery of air traffic in the region,” she added. “What we know is that growth will be slower, even if the new peace is lasting.” The conflict, which began on February 28, will have cascading effects for some time, Georgieva said, including the closure of oil refineries and shortages of refined products, which are already affecting transport, tourism and trade. Another 45 million people will face food insecurity, bringing the total number of hungry people to more than 360 million. Disruptions in supply chains are also expected to continue, given the industrial dependence on inputs such as sulfur, helium — used in chip manufacturing — and naphtha, essential for the production of plastics. The IMF will release a series of scenarios in its World Economic Outlook report next week, ranging from a relatively rapid normalization to a situation in which oil and gas prices remain high for a prolonged period, Georgieva said. Even the most promising scenario, according to Georgieva, includes reduced growth prospects due to infrastructure damage, supply disruptions, loss of confidence and other adverse effects. In January, the IMF projected global growth of 3.3% in 2026 and 3.2% in 2027.

Source link