IMF, World Bank and IEA warn of slow recovery in tourism, travel and food

The situation of thousands of refugees and people displaced by war, the travel and tourism sector and food production will “take time” to recover from the damage already inflicted by the conflict in the Middle East, with no end in sight yet, in the wake of the failure of the Peace Talks summit, which took place on Saturday, April 11, in Islamabad, Pakistan, warn three of the largest institutions in the world economic order, International Energy Agency (IEA), International Monetary Fund (IMF) and the World Bank (BM) in a joint statement, released on Monday night (Portugal time).

“Due to supply disruptions, shortages of essential raw materials are expected to have implications for the energy, food and other industries” and, as a result, “the war has also forcibly displaced people, impacted employment and reduced travel and tourism, effects that will take time to reverse”, warn the three entities.

According to the official note, “those responsible for the International Energy Agency, the International Monetary Fund and the World Bank Group met this Monday, April 13, as part of the coordination group they established at the beginning of April to maximize their institutions’ response to the energy and economic impacts of the war in the Middle East.”

Conclusion: “As we noted earlier this month, the impact of the war is substantial, global and highly asymmetric, disproportionately affecting energy importers, in particular low-income countries, the poorest, basically.

This “shock” led to a worsening “in oil, gas and fertilizer prices, generating concerns about food security and also the loss of jobs. Some oil and gas producers in the Middle East also suffered a drastic drop in export revenues”, says the same source.

“The situation remains very uncertain and navigation through the Strait of Hormuz has not yet returned to normal. Even after the regular flow of ships through the Strait resumes, it will take time for the global supply of essential goods to return to pre-conflict levels — and fuel and fertilizer prices may remain high for an extended period due to infrastructure damage.”