WORLD - The International Monetary Fund (IMF) expects global economic growth to reach 3.1% in 2026, warning that geopolitical tensions, disrupted energy supplies and renewed trade pressures are weighing on the world economy.
In its October 2026 World Economic Outlook, titled “Resilience Under Strain, Urgent Choices,” the IMF said the global outlook remained uneven, with economic performance increasingly shaped by the effects of conflict and investment in artificial intelligence (AI).
The fund projected global growth to remain at 3.1% in 2026, while advanced economies are expected to grow by 2.1% and emerging market and developing economies by 3.7%.
The report identified further disruptions to energy production and shipping, rising public debt and renewed trade tensions as major risks to the outlook. However, stronger-than-expected AI investment, faster productivity gains and improved trade arrangements could support economic activity.
AI Investment Concentrates Economic Risks
The IMF warned that technology-related investment, particularly in artificial intelligence (AI), is helping support economic activity amid the energy shock but is also concentrating risks. Gains remain clustered in a limited number of firms, sectors and economies, leaving global growth heavily dependent on a narrow set of technological and financial conditions.
The fund said economic resilience has been uneven, with outcomes varying according to economies’ exposure to the war and the AI investment boom.
Regional Outlook Remains Uneven
Lebanon and other economies across the Middle East and North Africa face risks from regional instability, disrupted trade, higher energy costs and weaker investment. The impact varies across countries, reflecting differences in their exposure to the conflict and their economic vulnerabilities.
The IMF expects the economies of the Middle East and Central Asia to contract by 0.3% in 2026, marking a sharp downgrade from its April projection of 1.9% growth.
The IMF’s broader assessment points to continued uncertainty, with the outlook dependent on geopolitical developments and the normalization of energy supplies and trade flows.
IMF Urges Fiscal Discipline and Policy Stability
The fund called on governments to rebuild fiscal buffers amid elevated public debt, rising sovereign borrowing costs and competing spending demands.
It recommended credible fiscal adjustment plans combining stronger revenue collection with more efficient public spending, supported by institutional improvements.
Any government assistance designed to cushion households from higher food and energy prices should be temporary and targeted, the IMF said, without undermining longer-term fiscal sustainability.
The report also identified AI-related investment as a potential source of stronger productivity and growth, although the global outlook remains vulnerable to geopolitical and economic shocks.
