Saudi Finance Minister Mohammed Al-Jadaan, Chairman of the International Monetary and Finance Committee (IMFC), warned that geopolitical challenges could have negative implications on global economy, if not addressed properly.
Al-Jadaan said that the world is not free of challenges, including geopolitical challenges mentioned by the IMFC members, which can have “severe consequences” if they are not managed. He was referring to the war in Ukraine, the crisis in Gaza, and the obstruction of shipping in the Red Sea.
He spoke during a joint press briefing with the IMF Managing Director, Kristalina Georgieva, at the end of the 49th meeting of the Fund’s IMFC, on the sidelines of the IMF spring meetings in Washington.
The Saudi Minister added that low-income countries are not evenly feeling the pain, while advanced economies and emerging markets are in a lot better position.
“The focus is on resilience. We need to make sure that we provide that support. The IMFC members will continue to look for ways to provide our low-income country members with the support that is needed,” he said.
In a statement published on behalf of the Committee, Al-Jadaan said the IMFC members “acknowledged that these situations have significant impacts on the global economy. Today’s era must not be of war and conflict.”
He added, “A soft landing for the global economy appears to be drawing closer. Economic activity has proved more resilient than expected in many parts of the world, though it continues to diverge across countries. However, medium-term global growth prospects remain weak. Ongoing wars and conflicts continue to impose a heavy burden on the global economy.”
“Although inflation has declined in most regions, due to the mitigation of supply shocks and the effects of tight monetary policies, its persistence urges cautions,” he warned.
Al-Jadaan emphasized that “Against this background, our policy priorities are to achieve price stability, strengthen fiscal sustainability, and safeguard financial stability, while promoting inclusive and sustainable growth.”
“We will proceed with rebuilding fiscal buffers, carefully tailoring actions to country-specific circumstances, while protecting the most vulnerable and growth-enhancing investment,” he pointed out.
Al-Jadaan has been selected by the members of the IMFC as Chair of the Committee for a term of 3 years, starting from January 4, 2024.
