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Headquarters of the International Monetary Fund
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Jim Lo Scalzo / dpa
The International Monetary Fund (IMF) will lower its forecast for global economic growth in the coming month due to the consequences of the Russian war of aggression in Ukraine.
This was announced by IMF boss Kristalina Georgiewa on Thursday.
»First we are experiencing a crisis like no other with the pandemic.
And now we're in even more shocking territory.
The unthinkable happened - we have a war in Europe,” said the Bulgarian.
In addition to human suffering, the war is also leading to massive economic upheavals - for Ukraine, for Russia and beyond, warned Georgieva.
The war will lead to higher commodity prices, further fueling inflation and contributing to a worsening business climate and tighter financing conditions.
In its January forecast, the IMF still expected global economic growth of 4.4 percent for this year.
As planned, the IMF will present an updated forecast in April.
Georgieva warned that the war would have “massive” economic consequences for Ukraine.
"The damage to the infrastructure is already massive." In addition, there is a movement of refugees that has not been seen in Europe since the Second World War.
"Even if the fighting ended now, the cost of recovery and reconstruction would be massive," Georgieva said.
The IMF already granted the country an emergency loan of 1.4 billion US dollars on Wednesday and is ready to help beyond that.
Russia, on the other hand, is facing a "deep recession" in view of the "unprecedented sanctions," Georgieva said.
The depreciation of the national currency, the ruble, leads to higher inflation, which "significantly weakens the purchasing power and standard of living for a large part of the Russian population," she explained.