World Bank President Concerned About Impact of Ongoing Israel-Hamas War on Global Economy

On Tuesday, November 2, World Bank President Ajay Banga expressed concern over the continuation of the war in Gaza and the potential for its expansion in the region, stating, "I think its impact on economic development globally is serious." According to Bloomberg News, at an investor conference in Saudi Arabia, he noted that the conflict between Israel and Hamas could deliver a "serious blow" to global economic development. He emphasized, "I believe what is happening in Israel and Gaza will have a more serious impact on global economic development." The World Bank President believes the world is in a very dangerous situation. Bloomberg also reported that this war could lead to a global economic recession, adding that conflict in the Middle East could create tremors worldwide, as this region is a significant energy supplier and a crucial shipping passage. The news outlet referenced the Arab-Israeli war of 1973, which led to an oil embargo and years of stagflation in industrialized countries' economies. Meanwhile, Bloomberg examined various scenarios of the conflict in Gaza, identifying a direct war between Iran and Israel as a low-probability but dangerous scenario. The report stated that direct conflict between Iran and Israel could trigger a global recession, as a sharp increase in oil prices would significantly impact economic growth and elevate inflation. Kristalina Georgieva, Managing Director of the International Monetary Fund, also mentioned last week that the Fund's analysts are working to prepare for the next "unimaginable" shock to the global economy. OPEC has rejected the Islamic Republic's requests; there are neither sanctions nor expulsion of Israeli ambassadors. The IMF chief stated that the Israel-Hamas war has darkened the outlook for the global economy.