Bogota- The global economy is moving towards a second Cold War. Due to the ongoing tension between the US and China, the global economy can suffer a seven trillion-dollar loss. Besides, there was proper global growth in the last three decades after the first Cold War between the US and Soviet Russia. Nonetheless, there was peace all over the world. However, the United States has again entered a Cold War. The deputy managing director of the International Monetary Fund (IMF), Gita Gopinath, warned that the US cold war with China, not Soviet Russia, could cause huge damage to global development.

During the Cold War between the United States and Soviet Russia, the global economy suffered enormously. It also affected the economies of these two countries. However, after the collapse of Soviet Russia, this Cold War ended, and all the countries involved, including the US, started focusing on their respective economies. Gopinath, the deputy managing director of the IMF, claimed that the global economy had grown well in the last three decades. However, Gopinath expressed concern that the international developments in the previous few years are detrimental to this development. Moreover, Gopinath warned that after the end of the Cold War, the global economy and geopolitical activities indicated signs of instability.

Due to the Russia-Ukraine conflict, most of the world’s countries were divided into two groups. Meanwhile, Gopinath also reminded that the sanctions imposed by the United States and the European countries against Russia had impacted only the Western economies. Also, this conflict reduced the pace of the global economy. At the same time, the deputy managing director of the IMF warned that conflict between Israel and Hamas has once again created differences between these groups. Simultaneously, Gopinath claimed that the effects of these were visible even in the fuel-rich Gulf countries. However, she warned that more than that, the rising US-China tensions and trade differences are pushing the global economy towards a second Cold War. Gopinath also said that these two superpowers contribute 43% to the global GDP.

In the last five years, the US imports from China have decreased, and the trade between the two countries is claimed to be less. Due to these two countries, two factions have been formed internationally. Gopinath claimed that the global economy has also been divided into two groups. She expressed her fear at the meeting held in Colombia that if the global economy gets divided into two groups, the US and Europe versus China and Russia, it will cause a loss of seven trillion dollars. Gopinath warned that if this rift widened, we would face a new Cold War, and the global economy would eventually suffer heavy losses.

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