Economic Risks from Geopolitical Tensions Highlighted by Saudi Finance Minister in Riyadh

Saudi Arabia’s Finance Minister, Mohammed Al-Jadaan highlighted during his participation in a panel at the World Economic Forum special meeting in Riyadh on April 28, that the conflicts in Gaza and Ukraine are exerting substantial stress on the global economic climate.

He emphasized that the increasing geopolitical threats are a primary risk to the global economy, significantly influenced by the direct economic impacts of these conflicts. Al-Jadaan pointed out that such geopolitical tensions are not only escalating but are also affecting economies through heightened economic sentiment.

He further expressed deep regret over the loss of civilian lives in these conflicts, stressing the importance of deescalation by responsible leadership and countries.

Saudi Arabia, according to Al-Jadaan, has been actively working to reduce regional tensions, which he described as a precise goal for the nation, emphasizing the need to focus on regional growth and economic development over political strife.

During the forum, Palestinian President Mahmoud Abbas also spoke, noting the severe impact of the Gaza conflict, which started with a Hamas-led attack on southern Israel on October 7 of the previous year, leading to significant Palestinian casualties and extensive destruction within Gaza.

Al-Jadaan also warned about the negative consequences of geopolitical maneuvering, including economic fragmentation and protectionism, which could undermine global economic health. He advocated for adaptable policymaking to handle such challenges.

Kristalina Georgieva, the  International Monetary Fund‘s managing director, also addressed the issue of economic fragmentation, marking it detrimental to growth prospects. She outlined immediate priorities for countries, including managing inflation and rebuilding fiscal buffers, while emphasizing the importance of cooperation.

Al-Jadaan concluded by stressing the importance of long-term economic planning and adaptation to changing circumstances, underscoring the need to focus on human capital as a long-term investment for regional and global prosperity.

The forum gathered about 1,000 officials and experts from 92 countries to discuss global collaboration, growth, and strategies for handling interconnected crises and geopolitical tensions.