The International Monetary Fund published its April 2026 Regional Economic Outlook for the Middle East and Central Asia and, in a Spring Meetings press briefing, set out a materially weaker 2026 baseline for the Middle East, North Africa, Afghanistan and Pakistan (MENAP) following the outbreak of war on 28 February and the disruption to energy, trade routes and confidence. Under its reference scenario, MENAP growth is projected to slow to 1.4% in 2026, a 2.3 percentage point downgrade from its October forecast, alongside a policy call for targeted and temporary fiscal support, continued anti-inflation monetary stances, and tighter supervisory focus on liquidity and foreign-currency mismatches. The briefing highlighted disruption around the Strait of Hormuz, with an estimated 13 million barrels per day reduction in oil and gas output, Brent crude peaking at USD 118 per barrel after surpassing USD 100, and European gas prices rising by around 60%. Fertilizer and broader logistics disruptions were flagged as key transmission channels into food prices, particularly for low-income and fragile states where food accounts for 45% to 50% of total imports, with risks to external balances, reserves and social stability. Impacts were described as uneven, with five of eight conflict-affected oil exporters projected to contract in 2026 and Qatar cited as having a nearly 15% downward revision versus October projections; sovereign spreads widened by 50 to 100 basis points across several countries in March before returning to pre-conflict levels after the ceasefire announcement. For the Caucasus and Central Asia, growth is projected to slow to 4.8% in 2026 from 6.2% in 2025, with inflation around 8% on average and public debt projected at 23.4% of GDP. IMF staff noted the projections were finalised using information available up to mid-March and assume the conflict lasts a few weeks with gradual normalisation in energy trade and production by June to July 2026. The reference scenario uses an average 2026 oil price of USD 82 per barrel versus USD 100 in the adverse scenario, with officials indicating market pricing at the time of the briefing sat between the two scenarios.
International Monetary Fund 2026-04-16
International Monetary Fund releases April 2026 Middle East and Central Asia outlook and downgrades MENAP 2026 growth to 1.4%
The IMF’s April 2026 Regional Economic Outlook for the Middle East and Central Asia projects MENAP growth of 1.4% in 2026, a 2.3 percentage point downgrade from October, reflecting war-related disruptions to energy, trade routes and confidence. It calls for targeted, temporary fiscal support, continued anti-inflation monetary policy, and tighter supervision of liquidity and foreign-currency mismatches. The IMF cites severe but uneven impacts from disruptions around the Strait of Hormuz, including a 13 million barrels per day drop in oil and gas output, Brent crude peaking at USD 118, and heightened food price risks for low-income and fragile states, while noting sovereign spreads have partially normalised after a ceasefire announcement. Projections, based on data to mid-March and a short-lived conflict, assume a 2026 reference oil price of USD 82 versus USD 100 in an adverse scenario.