IMF Revises MENA Growth Forecast to 2.6% for 2025

The International Monetary Fund (IMF) has significantly revised downward its 2025 growth forecast for the Middle East and North Africa (MENA) region to 2.6%, citing global trade tensions, regional conflicts, slow structural reforms, and continued oil production cuts as key factors restraining economic recovery. The IMF noted that while direct impacts from US tariffs remain limited due to low trade integration and exemptions for hydrocarbon goods, indirect effects—such as reduced investment, weakened financial markets, and softened oil prices—are putting additional strain on regional economies. Oil-exporting countries in particular are facing pronounced challenges, with growth projections for Saudi Arabia and Iraq notably downgraded. The region's overall growth is expected to improve only gradually, reaching 3.4% in 2026, but risks remain predominantly on the downside. The IMF also highlighted that financing pressures will intensify for countries with high debt and that further policy measures are needed to navigate ongoing uncertainty. Inflation is projected to decline across most of the region, with elevated rates persisting only in a few economies.