IMF Slashes MENA Growth Forecast
Analysis based on 12 articles · First reported Apr 14, 2026 · Last updated Apr 19, 2026
The International Monetary Fund's revised economic outlook for the Europe, the Middle East and Africa region indicates significant negative impacts on oil-exporting countries, leading to reduced GDP growth forecasts for entities like Iran, Bahrain, Iraq, Kuwait, and Qatar. The disruption of shipping through the Strait of Hormuz and the United States blockade of Iran's ports are expected to cause inflationary pressures and cloud the global economic outlook, affecting commodity markets and potentially increasing energy prices.
The International Monetary Fund has sharply revised down its real GDP growth forecast for the Europe, the Middle East and Africa region to 1.1% for 2026, a 2.8 percentage point drop from its January projection. This downgrade is primarily attributed to the ongoing Iran war, which has seen Iran attack Gulf neighbours in response to United States-Israel strikes. These attacks have damaged major energy facilities and disrupted shipping through the Strait of Hormuz, a critical chokepoint for global oil and liquefied natural gas flows. The conflict has also led to a United States military blockade of Iran's ports following the breakdown of U.S.-Iran talks. Consequently, Iran's economy is forecast to shrink by 6.1% this fiscal year, while Bahrain, Iraq, Kuwait, and Qatar are also expected to see their economies contract. Saudi Arabia, though also affected, is projected to fare better due to its diversified infrastructure. The war has created inflationary pressures and clouded the global economic outlook.
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