UN report revises down global GDP growth to 2.5% for 2026 due to Mideast crisis

The global economy is facing more pressure because of the crisis in the Middle East, according to a new report from the United Nations. The crisis is slowing economic growth, pushing prices up again, and creating uncertainty in financial markets.

Global economic growth is now expected to be 2.5% in 2026, lower than earlier predictions, with a small improvement expected in 2027.

The biggest impact is on the energy sector, as oil and energy supplies are disrupted, causing higher fuel prices, shipping costs, and insurance costs. This increases production expenses for businesses and everyday costs for households.

Food prices are also a concern because fertilizer supplies have been disrupted, which could reduce crop production and make food more expensive.

Inflation, which had been improving since 2023, is expected to rise again in both developed and developing countries.

Although strong job markets, consumer spending, and AI-related investment are helping the economy, they may not be enough to fully balance these problems.

The hardest-hit region is expected to be Western Asia, where economic growth could drop sharply due to energy disruptions, damaged infrastructure, weaker tourism, and trade problems.

The UN also warned that many developing countries may struggle more with debt and rising borrowing costs, making economic recovery and development harder.

Credit : CGTN