UN Secretary-General Antonio Guterres on Thursday warned of devastating consequences of prolonged disruptions in the Strait of Hormuz.
In a press encounter, Guterres offered three scenarios. In the worst-case scenario where the strait remained closed until the end of the year, global inflation would skyrocket past 6 percent, and growth would plummet to 2 percent.
Immense suffering takes hold, especially among the world's most vulnerable populations, Guterres warned, adding that the world confronts the specter of a global recession, with dramatic impacts on people, on the economy, and on political and social stability.
Guterres said these consequences are not cumulative but exponential. The longer this vital artery is choked, the harder it will be to reverse the damage and the higher the cost to humanity. Even in the best-case scenario, "where restrictions are lifted today," supply chains will take months to recover, prolonging lower economic output and higher prices, he warned.
"This year's global economic growth will still drop from 3.4 to 3.1 percent. Global inflation -- which had been declining -- will climb from 3.8 to 4.4 percent. And global merchandise trade growth will shrink from 4.7 percent last year to roughly 2 percent, with some meaningful supply chain interruptions," he said.
In a second scenario, where disruption drags on through midyear, global economic growth would fall to 2.5 percent. Inflation would rise to 5.4 percent. Some 32 million more people would be pushed into poverty and 45 million more people would face extreme hunger, he said.
As the Middle East crisis is lumbering into its third month, the consequences grow dramatically worse with each passing hour despite a fragile ceasefire between the United States and Iran, he said.
Guterres called for the reopening of the Strait of Hormuz and urged all parties to refrain from actions that could undermine the current ceasefire.
UN chief warns of severe consequences of prolonged Hormuz closure
