At the annual Spring Meetings co-hosted by the International Monetary Fund and the World Bank in Washington on Thursday, IMF chief Kristalina Georgieva said the US-Israel conflict with Iran has engulfed the Middle East in violence, snarled supply chains and sent oil prices surging after Tehran blocked the Strait of Hormuz.
The IMF anticipates having to provide up to 50 billion USD in immediate financial assistance to countries affected by the conflict, with food insecurity set to affect at least 45 million people. Georgieva said that, given the spillovers from the conflict, the IMF expects near-term demand for balance-of-payments support to rise by somewhere between 20 billion and 50 billion USD, with the lower bound prevailing if ceasefire holds.
IMF reports indicate that food output in countries affected by conflict could decline by 3% in the first year and continue to decrease in the following years. Low-income countries face a higher risk of food insecurity and will require additional international support as global aid resources continue to shrink.
