Economics & Development

In 2025, GDP growth is estimated at 5.3 percent (3.0 percent per capita), driven by broad-based sectoral expansion. Inflation fell to -0.5 percent, reducing the extreme poverty rate to 34.6 percent. Growth is projected to slow to 4.9 percent in 2026, reflecting spillovers from the conflict in the Middle East. The outlook faces downside risks from insecurity, climate, and terms-of-trade shocks.

The economy shows early signs of recovery, supported by the return of displaced populations, pickup in economic activity, and easing supply constraints. Modest improvements in trade flows, localized market activity, and price stabilization in secure areas indicate nascent gains. However, the outlook remains uncertain. Recovery prospects depend on restoring peace and stability and rebuilding institutional capacity.

Growth remained strong in 2025 at 3.2 percent, driven by construction, forestry, and robust private consumption amid low inflation and an accommodative monetary policy. Recent global developments may dampen growth in 2026. Poverty has declined, external balances have stabilized and reserves remain adequate. Expansionary fiscal stance has kept public debt high. Medium-term growth is expected to return to trend, hinging on fiscal consolidation and reforms.

Growth is easing as weaker remittances and returning migrants weigh on household incomes and consumption, while the oil price shock is raising inflation. Investment is firmer—supported by manufacturing foreign direct investment (FDI) and improved trade access to the U.S. market—boosting jobs and helping absorb returnees. A prolonged property downturn is increasing non-performing loans (NPL), heightening macro-financial risks.

Jordan’s economy continued to expand in 2025, supported by stable macroeconomic conditions and reforms. Inflation declined, while external balances improved. Fiscal consolidation continued, although public debt remains high. The outlook is subject to heightened uncertainty amid the ongoing conflict in the Middle East. Growth is projected to gradually strengthen to around 3 percent over the medium term, supported by reforms and stronger private-sector dynamism.

The Palestinian economy experienced an unprecedented contraction after the 2023–25 Gaza conflict. Despite the ceasefire, Gaza still suffers from catastrophic infrastructure destruction, access restrictions, and loss of life. Spillover effects in the West Bank included job losses, service disruptions, and an intensified fiscal crisis. The outlook depends on security stability—locally and regionally—Gaza’s reconstruction, and how Israeli restrictions in the West Bank evolve.

Qatar’s economy has been significantly affected by the conflict in the Middle East, including attacks on liquefied natural gas (LNG) infrastructure and disruptions to the Strait of Hormuz, the primary route for its hydrocarbon exports. The halt in LNG production and constrained trade flows are expected to drive a sharp contraction in 2026. While strong external buffers provide some resilience, risks to the near-term outlook are firmly tilted to the downside.

Despite a modest increase in aggregate output, economic conditions in Afghanistan weakened in 2025 amid sharp aid reductions, drought, large returnee inflows, and prolonged border closures with Pakistan. GDP per capita is estimated to have declined by 5.6 percent. While fiscal balance was maintained, the trade deficit widened, and the outlook remains bleak amid regional conflict, refugee uncertainty, and declining external aid.

Growth is projected to slow to 1.3 percent in 2026 before edging up to 2.3 percent in 2027, as external shocks from the Middle East conflict compound domestic structural constraints. Significantly higher energy prices and disruptions to travel and shipping weigh on soft manufacturing, despite a temporary surge in exports. Downside risks dominate, underscoring the need for structural reforms to lift productivity and create better jobs.

Growth in El Salvador accelerated markedly in 2025, supported by strong investment, record remittance inflows, and robust performance in construction and tourism. Over the medium term, growth is expected to stabilize around 3 percent, above its historical average, while poverty is projected to reach 28 percent. Continued progress on its reform agenda will be critical to sustaining this growth trajectory and reducing fiscal and external imbalances.

Real growth is expected at 1.3 percent in 2026, gradually rising to 1.9 percent in 2028, as domestic demand recovers, USMCA-related uncertainty eases over the forecast horizon, and inflation declines toward 3.6 percent. Fiscal deficits are expected to remain large, with debt rising, driven by high social spending, interest costs, Petróleos Mexicanos (PEMEX) support, and infrastructure needs. Poverty rates are projected to decline to 20.2 percent in 2028.

Driven by rapid expansion of oil and gas production, Guyana is one of the fastest-growing economies in the world. The government is pursuing ambitious public investment to transform the non-oil economy and address development needs. However, progress in poverty reduction is difficult to assess due to data gaps. Prudent management of petroleum revenues and continued institutional strengthening remain essential for broad-based growth.

Growth slowed to 2.7 percent in 2025, reflecting lower electricity production and softer tourism. The fiscal deficit widened from 3.3 to 4.3 percent of GDP in 2025, reducing policy space and increasing financing needs. Public debt is about 64 percent of GDP amid sizable upcoming repayments. As European Union (EU) accession advances, stronger fiscal discipline and rebuilding buffers will be key to safeguarding stability and supporting growth.