The International Monetary Fund (IMF) stated that the direct impact of recently imposed U.S. tariffs on Middle East and North Africa (MENA) economies will be limited, due to the region’s low trade exposure to the U.S. and the exemption of energy exports from these measures.
Jihad Azour, Director of the IMF’s Middle East and Central Asia Department, made these remarks during a press conference in Washington on the sidelines of the IMF and World Bank annual meetings. He noted that indirect effects may be more pronounced through weaker global economic growth, which could lead to lower oil prices and financial strain for oil-exporting countries in the region.
Azour indicated that some countries might benefit from rerouted global trade flows due to ongoing trade tensions, though such gains would likely be limited and temporary. He also highlighted indirect effects, including pressures on financial stability and capital flows, warning that widening yield gaps could burden emerging markets and middle-income countries with high debt levels.
Regarding growth prospects, the IMF lowered its forecasts for the MENA region, projecting 2.6% growth in 2025 and 3.4% in 2026, down by 0.9 and 0.5 percentage points from previous estimates. The IMF attributed this downgrade to global economic slowdown and ongoing regional conflicts.
The IMF also announced the establishment of an informal coordination group, in collaboration with the World Bank and regional partners, to support recovery efforts in conflict-affected countries by enhancing economic capacity building, providing policy advice, and offering financial support.
Azour emphasized the region’s potential as a bridge between East and West, stressing the need to leverage this advantage by strengthening trade and investment ties with neighboring regions and within the MENA region itself.
Amid global uncertainty, Azour urged MENA countries to focus on managing short-term risks while advancing structural reforms to ensure long-term growth sustainability. He underscored the importance of safeguarding economic and financial stability against risks such as declining global demand, geopolitical escalation, climate shocks, and reduced development aid.
Azour concluded by emphasizing that enhancing regional economic integration and expanding partnerships with regions like Sub-Saharan Africa and Asia could help MENA countries mitigate external shocks and achieve more sustainable economic growth.
