MIDDLE EAST – The Middle East and North Africa (MENA) region faces several economic risks in 2026, according to Jihad Azour, the IMF regional director for the Middle East and Central Asia.
In an opinion piece published this week in al-Sharq al-Awsat, Azour outlined five key challenges that could affect the region’s economies, which include Lebanon, Syria, Iran, and the Gulf states.
Despite ongoing challenges, the IMF raised its growth forecast for the region to 3.7% in 2026, up from 3.3% earlier.
Azour credited the region’s resilience in 2025 to limited U.S. trade exposure, higher oil production, lower energy prices for importers, strong remittances, robust tourism, and domestic demand.
He then identified five main risks for 2026:
Delayed Effects of Uncertainty: Policy and economic shocks from 2025 may continue to affect investment, employment, and consumption in 2026.
Rapid Growth of Artificial Intelligence: While AI has supported confidence and investment, concerns about potential market overheating remain.
Tighter Global Financial Conditions: Rising borrowing costs could limit financial flexibility for countries with high financing needs.
Volatile Oil Prices: Sudden increases or decreases in oil prices could negatively impact both producers and importers.
Geopolitical Fragility: Post-conflict recovery, particularly in Syria, remains delicate, requiring stable peace, institutional rebuilding, and sustained external support.
Azour emphasized that structural reforms are essential to turn the resilience demonstrated in 2025 into lasting economic strength.
“The region must continue implementing reforms to ensure growth is sustained despite global and regional uncertainties,” he concluded.
