International Monetary Fund head Kristalina Georgieva said Wednesday that recent attacks on Saudi Arabia could impact people "everywhere” as "the Saudi economy is important for the region and the world."
Given the Saudi economy’s importance, “these developments have potentially negative spillovers for everybody, everywhere," IMF managing director Georgieva said at a news conference during the Annual Meetings of the Fund and World Bank in Bangkok.
The warning comes at a time when energy flows and shipping activity in the region are under pressure, with supply disruptions potentially affecting energy and trade costs as well as economic activity, particularly in economies dependent on oil and gas imports.
The IMF’s forecasts, released on Tuesday, highlight the scale of the expected impact of the disruptions on the region’s economies. The IMF expects the economies of the Middle East and Central Asia to contract by 0.3 percent in 2026, followed by growth of 6.3 percent in 2027, a trajectory that reflects the pressures of the current crisis as well as the anticipated recovery as the disruptions ease and energy and trade flows are restored.
The expected repercussions vary across regional economies depending on their exposure to shipping disruptions and their ability to maintain exports. In its outlook for Saudi Arabia, the IMF raised its 2027 growth forecast to 7.9 percent, from 2.4 percent in July and 3.4 percent in April.
Meanwhile, it lowered its estimate for the economy’s contraction in 2026 to 3.3 percent, compared with 5 percent in its July update and 6.4 percent in April.
This trajectory reflects expectations that production and exports will regain momentum as shipping disruptions subside, although the speed and scale of the recovery will remain tied to developments in the security situation and the normalization of energy and trade flows.
The Saudi Ministry of Finance has projected stronger growth of 12.8 percent in 2027, according to the pre-budget statement.
