'Dangerous juncture': World Bank chief Ajay Banga warns of Israel-Gaza war's economic fallout

World Bank president Ajay Banga on Tuesday said that the Israel-Hamas war could prove to be a serious blow to the global economy and its development. Addressing an investor conference in Saudi Arabia, he said the world is at a "very dangerous juncture".

"There is so much going on in the world and geopolitics in the wars that you're seeing and what just happened recently in Israel and Gaza. At the end of the day, when you put all this together, I think the impact on economic development is even more serious," he said.

"I think we're at a very dangerous juncture," he added.

He said that geopolitical tensions pose the biggest threat to the world economy. He, however, said economic risks "tend to move around" fast and shouldn't be ignored.

He used an example from the United States to illustrate his point.

"The US 10-year Treasury (yield) just crossed 5% briefly yesterday, these are areas we haven't seen. So yes, that is right there lurking in the shadows," Banga said in Riyadh.

On October 7, Hamas terrorists entered Israel from the Gaza Strip and killed 1400 people, including women and children. They have been holding 222 people hostage.

In retaliatory air strikes, over 5000 Palestinians have died.

On Tuesday, Israel's military said it had escalated its bombardment of Hamas targets in the Gaza Strip. The terrorist group released two elderly Israeli women who had been taken hostage on October 7.

Meanwhile, French President Emmanuel Macron arrived in Tel Aviv on Tuesday.

He told Israel’s President Isaac Herzog that he came “to express our support and solidarity and share your pain” as well as to assure Israel it is “not left alone in the war against terrorism.”

With inputs from AFP, Reuters

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