Middle East and Central Asia’s economy to shrink in 2026 amid war, IMF says
The IMF has significantly downgraded its 2026 economic outlook for the Middle East and Central Asia, predicting a 0.3 percent contraction. The downturn is attributed to the ongoing US-Israel war on Iran and resulting disruptions to shipping in the Strait of Hormuz.
Why it matters
This forecast highlights the severe regional economic instability caused by geopolitical conflict, particularly for oil-dependent nations facing double-digit GDP declines.
Iraq, Bahrain, Kuwait and Qatar face double-digit declines in GDP amid the fallout from the US-Israel war on Iran.
x whatsapp-stroke copylink google Add Al Jazeera on Google info The MENA region's GDP is forecast to contract by 0.3 percent in 2026, a sharp downgrade from the 1.9 percent expansion projected in April, the IMF says [File: Sakchai Lalit/AP Photo] By John Power Published On 13 Oct 2026 13 Oct 2026 The economy of the Middle East and Central Asia is set to shrink in 2026 amid the fallout of the US-Israel war on Iran, with countries such as Kuwait and Qatar facing double-digit contractions, according to the International Monetary Fund (IMF).
The region’s gross domestic product (GDP) is forecast to contract by 0.3 percent this year, a sharp downgrade from the 1.9 percent expansion projected in April, the IMF said in its latest economic outlook on Tuesday.
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