IMF: MENA Economy Faces Sharp Contraction in 2026 as Regional Conflict Disrupts Growth

The International Monetary Fund (IMF), in its October 2026 Regional Economic Outlook for the Middle East and Central Asia, highlights the substantial economic challenges facing the Middle East and North Africa (MENA) as the regional conflict continues to disrupt economic activity. The escalation of the war has affected energy production, shipping, trade, tourism, and confidence, creating a shock that has been felt very differently across countries. While economies directly exposed to the conflict have experienced severe pressure, others have shown considerable adaptability. However, the IMF stresses that the financial and economic buffers supporting this resilience are gradually being depleted, increasing the region’s vulnerability to further disruptions.

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