The United Nations has significantly lowered its global economic growth forecast, attributing the revision to the escalating crisis in the Middle East.<\/p>\n
Global gross domestic product (GDP) is now projected to grow by 2.5 percent<\/b> this year and 2.8 percent<\/b> in 2027. This marks a downgrade from the UN economists’ January forecast, which anticipated growth of 2.7 percent in 2026 and 2.9 percent the following year.<\/p>\nKey Factors Behind the Downgrade<\/h3>\n
The UN\u2019s Department of Economic and Social Affairs highlighted several critical factors for the revised outlook, including rising energy prices due to the closure of the Strait of Hormuz<\/b> and increased volatility in global financial markets.<\/p>\n
Shantanu Mukherjee, director of economic analysis at the department, stated that what initially impacted energy markets when the United States and Israel began the conflict on February 28<\/b> has now evolved into a \u201cbroader supply shock of uncertain scope, magnitude and duration that is rippling across the world.\u201d<\/p>\nUncertainty and Potential Scenarios<\/h3>\n
Mukherjee noted that current forecasts assume a gradual easing of oil prices in the second half of the year and that governments will effectively utilize fuel reserves to mitigate some of the economic shock. However, he warned of an \u201cadverse scenario\u201d where global growth could decelerate to just 2.1 percent<\/b>, a performance comparable to the worst economic periods of this century, excluding the COVID-19 pandemic and the 2007-2009 global financial crisis.<\/p>\n
\u201cOur numbers right now are coming with a significant amount of uncertainty,\u201d Mukherjee told a news conference, emphasizing that \u201cuncertainty\u2026 in and of itself is a significant drag on the economy.\u201d<\/p>\n
Developing countries are expected to bear the brunt of this economic slowdown, with their growth projected to be 1.3 percentage points below the pre-pandemic average<\/b> this year, significantly more than the 0.7 percentage-point decline anticipated for the global economy as a whole.<\/p>\n
Western Asia is forecast to experience the most severe slowdown among all regions in 2026, with the UN drastically cutting its growth projection from 4.1 percent to 1.4 percent<\/b>. Other regions, including the Caribbean, West Africa, Central Africa, South-Eastern Europe, and the United Kingdom, have also seen their forecasts for this year reduced by 0.4-0.5 percentage points.<\/p>\n
Conversely, the outlooks for the world\u2019s two largest economies, the US and China<\/b>, remain unchanged, with projected growth rates of 2 percent and 4.6 percent<\/b>, respectively.<\/p>\nStrait of Hormuz Situation<\/h3>\n
Despite a truce agreed upon by the US and Iran on April 8, which paused the conflict, shipping activities in the Strait of Hormuz remain largely halted. This standstill is attributed to the threat of Iranian attacks<\/b>, severely disrupting the global supply of oil and natural gas. Maritime intelligence firm Windward reported that only 10 commercial ships<\/b> transited the waterway on Monday, a stark contrast to the approximately 130 vessels that crossed daily before the conflict began.<\/p>\nBroader International Consensus<\/h3>\n
The UN’s revised forecast follows a similar move by the International Monetary Fund (IMF), which in April also downgraded its global economic growth projection from 3.3 percent to 3.1 percent, underscoring a broader international concern over the economic outlook.<\/p>\n
#GlobalEconomy #UNGrowthForecast #MiddleEastCrisis #EconomicSlowdown #StraitOfHormuz #EnergyPrices #GDPForecast #DevelopingNations #GeopoliticalRisk #SupplyChain<\/p>\n","protected":false},"excerpt":{"rendered":"
The United Nations has significantly lowered its global economic growth forecast, attributing the revision to the escalating crisis in the Middle East. Revised Economic Outlook Global gross domestic product (GDP) is now projected to grow by 2.5 percent this year and 2.8 percent in 2027. This marks a downgrade from the UN economists’ January forecast, […]<\/p>\n","protected":false},"author":1,"featured_media":8988,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[],"class_list":["post-8987","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-middle-east-news"],"_links":{"self":[{"href":"https:\/\/vanak.news\/index.php?rest_route=\/wp\/v2\/posts\/8987","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vanak.news\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vanak.news\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vanak.news\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/vanak.news\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=8987"}],"version-history":[{"count":0,"href":"https:\/\/vanak.news\/index.php?rest_route=\/wp\/v2\/posts\/8987\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vanak.news\/index.php?rest_route=\/wp\/v2\/media\/8988"}],"wp:attachment":[{"href":"https:\/\/vanak.news\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8987"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vanak.news\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8987"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vanak.news\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8987"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}