Israel-Palestine Conflict Further Complicates Global Economic Challenges: Zoho’s Sridhar Vembu

SUMMARY

Vembu said the global economic growth had slowed down even before the start of the Israel-Palestine conflict and the future now remains uncertain till the ongoing crisis is not resolved

The Middle East is the fourth-largest market for Zoho and the company recently signed an economic cooperation agreement with the Israel-Asia Chamber of Commerce in June

Last week, Vembu, citing the slowdown in Zoho’s growth in September, cautioned that the global economy may be entering a difficult phase

Zoho CEO Sridhar Vembu has cautioned that the ongoing Israel-Palestine conflict has the potential to add to the woes of the global economy.

Speaking during a press conference in Bengaluru, Vembu said the global economic growth had slowed down even before the beginning of the Israel-Palestine conflict and the future now remains uncertain till the ongoing crisis in the Middle East is not resolved.

The Middle East is the fourth-largest market for Zoho and the company recently signed an economic cooperation agreement with the Israel-Asia Chamber of Commerce in June.

Responding to a question on how the conflict will affect the SaaS unicorn’s business, Vembu said, “In this kind of uncertainty, you should make no predictions, rather watch and absorb. We really hope it resolves soon.”

It must be noted that Vembu last week cautioned that the global economy may be entering a difficult phase, with growth likely to slow down going ahead.

“We saw a fairly pronounced slow down in growth in September across countries and across products. Given the geographically and product-wise diversified nature of our revenue streams, I suspect the global economy is taking a turn for the worse. Caution ahead,” Vembu said in a post on X.

The likes of the International Monetary Fund (IMF) and the World Bank have already warned of a slowdown in global growth due to high interest rates and other macroeconomic headwinds.

The IMF, in July, said the global growth is projected to decline to 3% in 2023 from an estimated 3.5% in 2022. Meanwhile, the World Bank predicted in June that the global growth will slow down to 2.1% in 2023 from 3.1% in 2022.

Meanwhile, Vembu said that India is the fastest-growing market for the company amid the ongoing slowdown.

The CEO said that Zoho’s India revenue grew 37% year-on-year in 2022. India, which is currently the third-largest market for the company, is likely to emerge as the second-largest market over the next 2-4 years, he added.