Geoeconomic Fragmentation May Have Serious Multi-Decades Impact On Global Economy

Geopolitical fragmentation may have a significant impact on the entire global economy in decades ahead, First Deputy Managing Director Gita Gopinath said on Thursday

WASHINGTON (UrduPoint News / Sputnik - 25th May, 2023) Geopolitical fragmentation may have a significant impact on the entire global economy in decades ahead, First Deputy Managing Director Gita Gopinath said on Thursday.

"Geoeconomic fragmentation can potentially have enormous ramifications for the global economy in the years and decades ahead," Gopinath said at the IMF Conference on Geoeconomic Fragmentation.

She warned that the early signs of fragmentation are taking root, and that the global economy already faces a surge in the number of trade and foreign direct investment (FDI) restrictions. That is particularly visible in the high-tech sector, she added.

"The number of trade and FDI restrictions has increased three-fold since 2018," Gopinath said.

IMF Managing Director Kristalina Georgieva warned earlier in May that trade fragmentation could cost up to 7 percent of global GDP in the long term.