Likewise, in economics Emerging markets and economies Developingresulting in disruptions in production and shipping Goods Primary – special Oilconflicts, civil unrest, and severe climate events have led to reductions in forecasts for the Middle East, Central Asia, and Sub-Saharan Africa.
On the other hand, forecasts were raised for emerging Asia, where a boom in demand for… Semiconductors and electronics, driven by large investments in the field artificial intelligenceto promote growth, which is a general trend that it supports Investments Huge public interest in both China and India. Five years from now, he is expected to reach… Global growth 3.1 percent – a poor performance compared to the pre-Covid-19 average.
According to the World Economic Outlook (Policy Shift and Growing Threats) report:
- Although the rate continues to decline Inflation Globally, service price inflation remains high in many regions, indicating the importance of understanding sectoral dynamics and calibrating monetary policies accordingly.
- As cyclical imbalances in the global economy recede, near-term policy priorities must be carefully calibrated to ensure a smooth economic downturn.
- At the same time, the necessary structural reforms must be implemented to improve medium-term growth prospects, while continuing to support the most vulnerable groups.
Growth fromKhRelatively loose
In this context, a report by the British newspaper “The Guardian” indicates that:
- The Fund’s World Economic Outlook report shows that the global economy is stuck in a relatively low growth pattern.
- But given how things were two years ago, when inflation was at its highest levels in four decades and Russian troops had just entered Ukraine, things could have been a lot worse.
As IMF Economic Advisor Pierre-Olivier Gorinchas noted, the battle against high inflation is almost over, and the battle has been won without causing the deep recession that some feared when energy prices rose in 2022.
Three risks
Despite this, there is a group of risks that the International Monetary Fund recognizes, and which the British newspaper report indicates, as follows:
The first risk is a slowdown Central banks In reducing borrowing costs, leading to a slowdown in growth and a reassessment of financial markets for the golden scenarios of the global economy.
Markets have firmly bought into the idea that central banks will get their policies right and then engineer a return of inflation to target levels without recession. This may be true in the United States, but it is less clear in the eurozone.
The second danger is that the war in the Middle East will escalate and lead to a sharp rise in… Oil prices. So far, commodity markets have been “relaxed” about the rising tensions; They do not see any imminent risk of disruption to crude supplies, but this may change quickly.
“Escalation in regional conflicts, especially in the Middle East, would pose serious risks to Commodity marketsThis is a warning that deserves attention, according to the newspaper.
Finally, regarding the third risk, there is a possibility of a return Donald Trump To the White House after Elections US Presidential Next month. Although the former president was not explicitly named, the International Monetary Fund estimates that a shift toward “unfavorable” industrial and trade policies would reduce global GDP by about 0.5 percentage points in 2026.
Customs tariffs
For the IMF, imposing trade barriers and supporting domestic industry provide a morale boost, but these measures often lead to retaliation and fail to improve living standards in the long run.
Trump is unlikely to heed concerns International Monetary FundHe proposed the idea of imposing a 20 percent tariff on all imports to the United States and a 60 percent tax on Chinese goods. If he wins the election in November, the next World Economic Outlook report to be issued by the International Monetary Fund in April 2025 will be interesting – and perhaps worrying, according to the Guardian.
- The International Monetary Fund has warned that it will increase Protectionism This would jeopardize global growth prospects, in light of the possibility of Donald Trump winning the US elections next month, raising the possibility of imposing sharp increases in… Customs duties.
- In his latest forecast, just two weeks ago Presidential electionsThe International Monetary Fund said it expects the global economy to grow by 3.2 percent this year and next.
- But expectations Global economy It warned that if higher tariffs hit a “significant portion” of global trade by mid-2025, they would wipe out 0.8 percent of economic output next year and 1.3 percent in 2026.
The IMF’s warning comes at the beginning of the multilateral financial institution’s annual meetings with the World Bank in Washington.
In the basic scenario, the Fund expected the US economy to grow slightly faster than it expected in July, at 2.8 percent this year and 2.2 percent in 2025.
Eurozone growth is expected to be much weaker, lower than the IMF forecast in July, at just 0.8 percent this year and 1.2 percent in 2025.
The Fund also lowered its growth expectations Chinese economy This year, by about 0.2 percentage points to 4.8 percent, as the country struggles to stimulate demand. The world’s second-largest economy is expected to grow by 4.5 percent in 2025.
According to a report by the Financial Times, the Fund’s estimates report reflects its expression of concern about “the continued modest global growth prospects in the medium term compared to pre-pandemic expectations,” and it is estimated that global growth within approximately five years is likely to reach about 3.1 percent. .
Five major threats
For his part, the economic expert, Dr. Ali Al-Idrissi, in special statements to the “Eqtisad Sky News Arabia” website, identifies five major threats to the global economy, the first of which is “geopolitical tensions” as follows:
- Geopolitical tensions: These are among the most prominent risks threatening global economic stability. Armed conflicts, such as the war in Ukraine, tensions between the United States and China over trade and technology, and tensions in the Middle East increase uncertainty in markets and affect global trade, investment, and supply chains. It also leads to higher energy and commodity costs, which increases inflationary pressures.
- InflationHigh inflation still represents a major threat to the global economy, with continuing pressures on the prices of goods and services… the rise in… Living costs It affects consumers’ ability to spend, which limits economic growth. Inflation is partly due to disruptions in global supply chains and rising energy costs.
- Tightening monetary policies: Interest rates are still at high levels. These levels negatively affect economic growth and investment, and may increase the cost of debt for countries and companies, which increases the risk of default.
- The slowdown in the growth of the Chinese economy: The Chinese economy is considered a major driver of global growth, and any slowdown in it could affect the entire global economy. The slowdown in China may affect demand for global commodities, especially raw materials, leading to lower prices and negatively impacting exporting countries.
- Climate risks: Increasing natural disasters resulting from climate change pose a threat to economies, especially those dependent on agriculture and tourism. Climate change increases insurance costs and leads to economic losses in affected areas.
He explains that Geopolitical tensions It overlaps with most of these threats, as it increases instability and directly affects global trade and investment flows, in addition to its impact on the stability of commodity and energy prices.
Geopolitical tensions
Also, a professor at the Moscow Higher School of Economics, Dr. Rami Al-Qalioubi, indicated in exclusive statements to the “Eqtisad Sky News Arabia” website that “geopolitical tensions have a major role in influencing the global economy, especially in the Middle East region. In the event of an escalation between Iran and Israel, There are threats to close the Strait of Hormuz, which will disrupt supplies Natural gas Qatari liquefaction and oil produced in the Gulf region, which may push oil prices to rise.
He added: “But in the long term, if the price of oil reaches $150 per barrel (as some estimates indicate in the worst scenarios), this may lead to a recession in the global economy, and then the price will decline again, as happened in 2008 during the global financial crisis.. “In this case, the world may suffer a recession and a financial crisis.”
However, Al-Qalioubi stresses the importance of recognizing that the parties to the conflict in the Middle East and Western countries are keen to avoid reaching the stage of all-out war, because it will lead to widespread destruction. Therefore, “I do not believe that there are existential threats to the global economy due to the current political tensions.”
Debts
Head of the Global Markets Department at Cedra Markets, Joe Yarak, said in exclusive statements to “Iqtisad Sky News Arabia” website: What is most concerning in the long term is the high debt ratio, which will put great pressure, especially on emerging countries. With higher interest levels, pressures will increase.
He adds: There are several other factors that cannot be denied, such as geopolitical tensions that create a state of instability, which increases pressure on the economies of countries experiencing these tensions, especially in cases of war. The fear is that these tensions may affect the prices of some commodities, such as oil, causing them to rise, and thus increasing pressure on countries’ domestic output. Any increase in prices contributes to an increase in inflation, which negatively affects the economies of countries.
In addition, tensions affect Supply chains And agricultural commodity prices, which adds further pressure. Yarak believes that what is most worrying is the high debt ratio, as the debt in the United States has approached $36 trillion, and even China suffers from the same problem, which portends danger. In the medium and long term, we may face economic crises as a result of these factors that have not been dealt with properly by the economic foundations and markets of countries.
