The Group of 24, a coalition of developing nations coordinated on international monetary and financial affairs, has sounded a stark alarm over the widening economic fallout from the Middle East conflict, warning that supply chain disruptions and energy market instability are compounding pre-existing vulnerabilities across emerging markets and developing countries.
Presenting findings at the World Bank and International Monetary Fund Spring Meetings currently underway in Washington, DC, the G-24 stated that the conflict is inflicting direct damage on civilian infrastructure while eroding living standards across affected regions. Beyond the immediate humanitarian toll, the group emphasized that the deterioration extends to the broader global economy, with consequences most acutely felt by nations still recovering from prior shocks.
Maritime Security and Infrastructure Vulnerabilities
The G-24 called for urgent protection of international maritime routes, warning that attacks on energy infrastructure impose long-term economic costs. Restoring damaged facilities requires substantial capital expenditure and extended timelines, creating structural bottlenecks that outlast the immediate conflict period. The group acknowledged efforts by OPEC Declaration of Cooperation participants to diversify export routes and maintain supply stability, yet cautioned that systemic risks remain elevated.
Oil-importing developing economies face mounting strain on current account positions as import bills expand while export revenues face headwinds. Simultaneously, the prospect of interest rate hikes in advanced economies compounds borrowing costs, with exchange rate pressures adding another layer of fiscal strain. Tighter global financial conditions and heightened investor risk aversion threaten to curtail private capital flows to emerging markets at precisely the moment when external financing becomes most critical.
Policy Constraints and Multilateral Response Gaps
The G-24 stressed that while domestic fiscal and monetary tools retain relevance, conventional policy responses—such as demand contraction or currency depreciation—may prove inadequate to absorb shocks of this magnitude. The group underscored the necessity for reinforced multilateral support and scaled-up development assistance to bridge financing gaps facing the most vulnerable economies.
Calling for a more robust Global Financial Safety Net anchored by a well-resourced IMF, the coalition urged timely completion of the 16th General Review of Quotas and substantive progress on the 17th review. Quota reforms must strengthen the voice and representation of emerging and developing economies while preserving the voting shares of the poorest member states, the G-24 insisted.
The group also pressed the IMF to adopt greater flexibility in responding to evolving risks, including refinement of its lending toolkit, enhanced surveillance mechanisms, and reviews of key frameworks such as the Low-Income Countries Debt Sustainability Framework. Calls were renewed for reforms to charges and surcharges, alongside exploration of regular Special Drawing Rights issuance to provide liquidity support for vulnerable member economies.
On development financing, the G-24 affirmed that the World Bank Group's focus on employment generation, infrastructure investment, and innovative financing mechanisms remains pivotal to sustained poverty reduction across the developing world.