{"id":386579,"date":"2026-04-11T11:07:30","date_gmt":"2026-04-11T11:07:30","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/386579\/"},"modified":"2026-04-11T11:07:30","modified_gmt":"2026-04-11T11:07:30","slug":"middle-east-war-to-cut-growth-deliver-cascading-impact-world-bank-chief-says","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/386579\/","title":{"rendered":"Middle East war to cut growth, deliver cascading impact, World Bank chief says"},"content":{"rendered":"

\n\tWASHINGTON: The war in the Middle East will have a cascading impact on the global economy, even if a ceasefire announced by US President Donald Trump takes hold, World Bank President Ajay Banga told Reuters in an interview on Friday.
And the damage will be far deeper if the ceasefire fails and the conflict escalates, he said.
Banga on Tuesday said global growth could be lowered by 0.3 to 0.4 percentage point in a baseline scenario, with an early end to the war, and by as much as 1 percentage point if it endures. Inflation could increase by 200 to 300 basis points, with a much higher impact \u2014 of up to 0.9 percentage point \u2014 if the war continues, he said.
The World Bank\u2019s baseline estimate now projects growth in emerging markets and developing economies of 3.65 percent in 2026, compared to 4 percent in October, dropping as low as 2.6 percent in an adverse scenario with a longer-lasting war. \u200cInflation in those \u200ccountries was now forecast to hit 4.9 percent in 2026, up from the previous estimate of 3 percent. \u200cThe extreme \u2060scenario could see \u2060inflation rising as high as 6.7 percent, according to estimates viewed by Reuters.
The war, which has killed thousands of people across the Middle East, has sent the price of oil up by 50 percent while disrupting supplies of oil, gas, fertilizer, helium and other goods, as well as tourism and air travel.
The two-week ceasefire announced by Trump appears tenuous, with Israel and Iran continuing strikes. Iran said on Friday that blocked Iranian assets must be released and a ceasefire must take hold in Lebanon before US-Iran talks, scheduled for Saturday in Pakistan, can proceed. Trump said that US warships were being reloaded with ammunition in case the talks failed.
\u201cThe question really is, does this current peace and the negotiations that \u2060are going to be happening this weekend \u2014 will this lead to a lasting peace and \u200cthen a reopening of the Strait (of Hormuz)?\u201d said Banga. \u201cIf it doesn\u2019t lead to \u200cthat, and if conflict were to break out again, would that have an even larger impact, or longer-term impact on energy infrastructure?\u201d
Banga said the \u200cworld\u2019s largest development bank was already in discussions with some developing countries, including small island states with no natural energy resources, \u200cabout tapping funds from existing programs under \u201ccrisis response windows.\u201d
The World Bank\u2019s crisis toolkit allows countries to tap previously approved but not yet disbursed funds without additional board approvals, increasing flexibility.
But Banga said the bank was cautioning countries to avoid setting up energy subsidies that they could not afford, which would trigger even bigger problems in the future.
\u201cI worry about making sure that they can come through this crisis, targeting what they need to do, but \u200cnot doing anything that further deteriorates that fiscal space,\u201d he said.
Many developing countries also have high debt levels and interest rates remain high, which constrains their ability to borrow money to \u2060fund measures to respond to \u2060the jump in energy costs and other goods caused by the war. The crisis has put a fresh spotlight on the need for countries to diversify energy supplies and boost self-sufficiency, Banga said. The World Bank last June ended a longstanding ban on funding nuclear energy projects as part of a push to meet rising electricity needs.
Nigeria, which had long faced problems, stood to benefit from a $20 billion investment made by the Dangote Group in refineries, which had actually increased output during the war, and was now supplying aviation fuel to neighboring countries.
\u201cNigeria should be breathing a sigh of relief. They\u2019ve built up the ability to have energy security for themselves through that huge investment,\u201d he said. \u201cIt\u2019s actually a really good example of the right thing being done in terms of energy self-sufficiency for them, but also for their neighbors.\u201d
The World Bank is also working closely with Mozambique, another African country, to expand its energy production capabilities in both natural gas and hydropower.
The World Bank had many energy products in the pipeline, Banga said, noting that talks were under way with some countries looking to extend the life of their fleets of nuclear reactors, and others keen to move into nuclear power.
\u201cIf you don\u2019t get nuclear and hydro and geothermal going at scale, along with wind and solar, they will end up doing more with traditional fuels, and nobody really wants that,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"WASHINGTON: The war in the Middle East will have a cascading impact on the global economy, even if…\n","protected":false},"author":2,"featured_media":386580,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[114,85,46],"class_list":{"0":"post-386579","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-business","9":"tag-il","10":"tag-israel"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/386579","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=386579"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/386579\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/386580"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=386579"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=386579"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=386579"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}