Middle East and Central Asia’s economy to shrink in 2026 amid war, IMF says

The GDP of the MENA region is expected to shrink by 0.3% in 2026, a sharp downgrade from the 1.9% growth forecasted in April, due to the fallout from the US-Israel war on Iran. Kuwait, Qatar, Iraq, and Bahrain are projected to experience significant contractions, with GDP declines of 16.7%, 15.6%, 16%, and 11.3% respectively. The IMF attributes the downgraded outlook to ongoing disruptions in shipping through the Strait of Hormuz, a vital route for one-fifth of global oil supplies.