IEA, IMF, WB to Form Coordination Grp to Support Countries from War Impact
The group will work with, and draw on, other international organizations’ expertise as needed.
Chennai:The International Energy Agency, International Monetary Fund, and World Bank Group have agreed to form a coordination group to respond to the energy and economic impacts of the war in the Middle East. It will monitor developments, align analysis, and coordinate support to policymakers to navigate this crisis.
The Middle East war has caused major disruptions to lives and livelihoods in the region and triggered one of the largest supply shortages in global energy market history. It has also disproportionately affected global energy importers through gas and fertilizers prices.
Supply chains are affected and tourism hit by flight disruptions. The resulting market volatility, weakening of currencies in emerging economies, and concerns about inflation expectations raise the prospect of tighter monetary stances and weaker growth, the agencies said in a release.
“At these times of high uncertainty, it is paramount that our institutions join forces to monitor developments, align analysis, and coordinate support to policymakers to navigate this crisis. This is especially the case for countries that are most exposed to the downstream impacts from the war and those confronting more limited policy space and higher levels of debt,” it said.
The group will assess the severity of impacts across countries and regions through coordinated data sharing on energy markets and prices, trade flows, fiscal and balance of payments pressures, inflation trends, export restrictions of key commodities, and supply chain disruptions.
It will coordinate a response mechanism that may include targeted policy advice, assessment of potential financing needs and related provision of financial support, and use of risk mitigation tools as appropriate.
It will also mobilize relevant stakeholders, including other multilateral, regional, and bilateral partners, to deliver coordinated and efficient support to countries in need.
The group will work with, and draw on, other international organizations’ expertise as needed.