All eyes on IMF-World Bank meetings amid global crises
https://arab.news/wzssj
The IMF-World Bank annual meetings will be held in Marrakesh from Oct. 10-16. This is the first time in half a century that the meetings have returned to Africa, which boasts the youngest population in the world.
It will also house the majority of the estimated roughly 2 billion people the world population is forecast to grow over the next three decades. This means as IMF Managing Director Christalina Georgieva aptly put it in her curtain raiser speech in Abidjan last week: “A prosperous world economy in the 21st century requires a prosperous Africa.”
Sadly, the annual meetings are bound to be overshadowed by events unfolding in Gaza and Israel, as will MENA Climate Week currently underway in the Saudi capital.
Nonetheless, these meetings are crucial. They serve as a global stocktaking exercise of economic developments and help calibrate how far we have come in achieving the 17 Strategic Development Goals.
The IMF’s Fiscal Monitor and Global Financial Stability Report will be unveiled on Oct. 10. Christine Lagarde, president of the European Central Bank, gave a precursor when she warned that the IMF would downgrade its forecasts except for the US. Indeed, the World Bank had downgraded the growth prospects for Asia by 0.3 percent in 2023 and 0.1 percent in 2024. Similarly, the ECB made downward revisions of growth forecasts to 0.7 percent this year and 1 percent the next.
It is not all gloom and doom as inflation is edging downward and economists expect a soft landing, notwithstanding a slower than expected in China, the world’s second-largest economy. The world’s fourth-largest economy, Germany, which is Europe’s traditional growth engine, is set to contract marginally this year.
The global economy is far from out of the woods yet the wars take their toll in terms of higher energy and food prices, which particularly affect the developing world. The recent troubles in the Eastern Mediterranean only exacerbate that picture. Central bankers warn that even if the trajectory of inflation is encouraging, they need to remain vigilant and we can expect interest rates to stay higher for longer.
The IMF calculated the price of successive shocks between 2020 and 2023 to total up to $3.5 trillion and counting.
It might be easy to forget big long-term global issues amid all the conflicts affecting the economy. There are, however, issues such as poverty and climate change, which will remain the big topics for decades to come. This is where the meetings in Marrakesh tie in with MENA Climate Week.
A UN-backed report recently calculated that developing countries needed $1 trillion annually until 2030 to achieve the Paris goal of reducing global warming to 1.5 degrees to pre-industrial levels. These are staggering numbers and financing will need to be found.
Looking at the global economy ahead of the IMF-World Bank meeting, we can choose to see the glass as half empty or half full amid all the convergent crises. However, if the world does not recognize the plight of developing countries and address the issues of poverty alleviation and climate change, the glass will be empty by 2030.
• Cornelia Meyer is a Ph.D.level macroeconomist, energy expert and CEO of Meyer Resources, a business consultancy.
