Seven countries warn IMF of growing risks to the global economy
Their statement highlights the effects of the Middle East war, inflation and uneven growth prospects.
Bank of Algeria Governor Mohand BOURAI delivered a statement on behalf of Algeria, Ghana, the Islamic Republic of Iran, Libya, Morocco, Pakistan and Tunisia at the 54th meeting. The countries said confidence in the global economy’s resilience was weakening as vulnerabilities grew.
Bank of Algeria Governor Mohand BOURAI delivered a statement on behalf of Algeria, Ghana, the Islamic Republic of Iran, Libya, Morocco, Pakistan and Tunisia at the 54th meeting. The statement said the global economy had remained broadly resilient, but confidence in the durability of that resilience was eroding amid the ongoing war in the Middle East.
The countries said shocks linked to conflicts were adding to inflationary pressures, while higher food costs were straining household budgets. Price dynamics could warrant successive increases in policy rates. Financial markets had remained broadly stable, supported by expectations that investment in artificial intelligence technologies would boost productivity over the medium term.
The October 2026 World Economic Outlook projects a deterioration in economic activity in the Middle East this year. Iran and other countries directly involved in the war face output losses from damage to civilian infrastructure and productive capacity, as well as disruptions to export routes. Higher energy and food prices are weighing on energy importers, including Morocco and Tunisia.
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Higher energy prices could, in contrast, improve the fiscal and external balances of Algeria and Libya. Pakistan’s growth could weaken if falling remittances and increased balance-of-payments pressures coincide with further declines in economic activity and employment in Gulf countries. In Ghana, tighter international financing conditions and lower capital inflows could raise borrowing costs.
The statement called for economic policies tailored to each country’s circumstances. Where conditions allow, countries should rebuild fiscal buffers by reducing deficits and putting public debt on a sustainable path, while protecting vulnerable groups and public investment. Monetary policy should remain firmly focused on price stability and keeping inflation expectations anchored.
The seven countries backed the International Monetary Fund’s (IMF) global action plan and called for closer coordination between the Fund, regional institutions and development partners. They urged the IMF to clarify financing needs and the terms for proposed adjustment policies, and called for the remaining national approvals of the 16th General Review of Quotas to be completed promptly, alongside decisive progress on the 17th review.
Translated from Arabic using artificial intelligence. Source: Bank of Algeria
