IMF downgrades Mena growth forecast
1 February 2024
The Washington-based IMF has revised down the expected real GDP growth figure for the Middle East and North Africa region for 2024 to 2.9%, down from the previous projection of 3.4% in its October economic outlook.
The downgraded growth forecast reflects, among other things, the deepening of the voluntary oil production cuts as part of a further Opec+ agreement in November, as well as the heightened instability in the region as a result of the war in Gaza and the Red Sea crisis.
The most recent agreement among the Opec+ members saw half a dozen countries agree to additional voluntary production cuts through to the end of Q1 2024 – in addition to the voluntary cuts announced in April 2023 and extended until the end of 2024.
The regional oil producers that agreed to these additional cuts were Saudi Arabia, Iraq, the UAE, Kuwait, Algeria and Oman, with the six countries collectively accounting for a 1.6 million barrel a day reduction in oil output, led by Riyadh, which alone cut 1 million b/d.
In the same update, the IMF revised down Saudi Arabia’s real GDP growth forecast for 2024 to 2.7%, down from a previous projection of 4.0% in its October economic outlook.
A week ago, the fund’s concluding statement to its Article IV consultation with Oman also saw it lower the growth forecast for that country to 1.4%, down from a previous forecast of 2.7% growth.
Both revisions reflect the country-level economic impact of these additional voluntary cuts, which will have an even greater impact on the fiscal side, cutting into government revenues and possibly spending.
Geopolitical impacts
The other major influence on the regional economy in the past three months has been the eruption of the war in Gaza and the Red Sea shipping crisis.
These twin events have had considerable impact on the most adjacent geographies, with the war in Gaza affecting economies across the Levant, as well as regional tourism, and the Red Sea crisis hitting trade.
In mid-December, a study commissioned by the UN Development Programme (UNDP) estimated that the economic cost of the war in Gaza on neighbouring Egypt, Jordan and Lebanon was set to exceed $10bn in 2023 alone and had the potential to push 230,000 more people into poverty.
It noted that the conflict was impacting consumption and trade and exacerbating the existing weak growth, high unemployment and fiscal pressure in the three countries.
Egypt has been acutely affected by both the impact on tourism and the fall in receipts from the passage of ships transiting through the Suez Canal – both major sources of revenue for the Egyptian government.
On 26 January, the UN Conference on Trade and Development (UNCTAD) estimated that weekly transits through the Suez Canal had fallen by 42% over the past two months, and that container ship transits specifically had plummeted by 67% as compared to one year previously.
However, the largest impact has been on liquefied natural gas (LNG) carriers, which have stopped altogether since 16 January, according to Jan Hoffmann, trade logistics chief at UNCTAD.
Cross-sector impacts
Tourism has also been severely impacted since the commencement of hostilities in October, with the significant tourism markets of Egypt and Jordan being subject to mass flight and hotel cancellations. For Lebanon, the regional economic crisis has merely compounded the already dire domestic economy crisis.
In the IMF’s January briefing, research department division chief Daniel Leigh noted that for Egypt, “despite strong tourism performance overall in 2023, there’s been a slowdown since the start of the conflict in Gaza, in Israel, with hotel bookings clearly coming down.
“Now, on top of that, there’s the escalation and the Red Sea attacks, which may impact, and are impacting, foreign exchange inflows. That’s about $700m a month, a very important source of foreign currency for Egypt.”
Leigh said the uncertainty of the situation was already impacting investment prospects, creating an even more urgent need for additional financing to enable reforms and bring inflation down to restore growth.
The IMF is currently in discussions with Cairo over the provision of additional financing to the Egyptian government in the form of an Extended Fund Facility (EFF) from the fund alongside a reform programme.
More broadly, the IMF has assessed that the shockwaves from the war in Gaza have already caused current accounts across the region to deteriorate and given rise to $30bn in additional financing needs among Arab states outside of the Gulf, with further fallout expected if the conflict drags on.
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Caution governs Jordanian bank lending12 June 2026
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Conflict to push global growth to post-pandemic low12 June 2026
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Emaar announces $55bn Dubai project12 June 2026
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Caution governs Jordanian bank lending
12 June 2026
In a region where geopolitical turbulence has amplified by an order of magnitude, Jordan is managing to stand out as a beacon of relative stability, with the Hashemite kingdom’s banking sector acting as a case in point.
Lending has grown in recent years, with credit up by an average 4.9% between 2020 and 2025, according to the Central Bank of Jordan (CBJ) – a faster rate than average nominal GDP growth of 2.3% over the same period.
The IMF took care to note an increase in credit to the private sector in its latest Article IV assessment of Jordan, standing at 80.1% of GDP at end-2024, compared to just 66.6% 10 years earlier.
Banks in the kingdom ended 2025 in a liquid state, but caution remains the watchword for local lenders. The loan-to-deposit relationship bears that out. For that year, deposits ended up 7.1% to JD50bn ($70.5bn), while credit facilities were up just 3.7% to JD36.1bn ($50.9bn).
Analysts see this as a case of Jordanian banks being prudent, given the tricky operating environment and limited lending opportunities, rather than banks being excessively defensive.
According to Christos Theofilou, an analyst at Moody’s Investors Service, it is cautious lending in fraught macroeconomic conditions.
“On the one hand, we’ve seen a structurally strong and stable deposit base that has been growing more compared to lending. That indicates a certain degree of limited risk appetite, but also the fact that, given the challenging operating conditions, there were limited business opportunities in the market,” says Theofilou.
Liquidity banked
Jordan’s banks look able to withstand further shocks, given solid capital positions and relatively strong earnings performances. Arab Bank, the largest lender, saw net profits grow 12% last year to $1.13bn, despite a highly charged geopolitical situation across Jordan and the neighbouring Palestinian territories.
As Moody’s notes, Jordanian banks’ funding base remains stable, with banks mainly deposit-funded – with deposits at 67% of total assets as of December 2025 – mostly comprising well-diversified retail deposits. The ratings agency noted that banks retain the capacity to increase lending without relying on more volatile and costly external funding, as indicated by the 72% loan-to-deposit ratio.
The earnings outlook in Jordan may be better than other banking sectors in the immediate region, but this does not translate into a picture of booming profits going forward.
“Profits should remain resilient, but we’re not expecting any significant improvement,” says Theofilou. “We have the challenging operating conditions, and the lower interest rates that have come down over the past few years. On the other hand, banks have had lower provisioning in the past 12 to 18 months compared to the period prior to that.”
Asset quality remains a strong point, despite some weakening over recent years. Moody’s sees non-performing loans (NPLs) falling below 5.5% this year from 5.8% in June 2025.
However, the continuing Iran conflict and its deleterious regional impacts – including on the West Bank, where about 9% of Jordanian banks’ loans are located – suggest that bank exposures to troubled sectors will require focus.
Concentration bites
Another challenge is the banks’ high credit concentration among large corporates, with a noted high exposure to real estate.
Commercial and residential real estate loans accounted for 17.4% of total credit facilities as of year-end 2024, while residential mortgages accounted for 40.9% of household credit. Regulatory oversight may limit the impacts – the CBJ caps loans for real estate at 20% of local currency customer deposits.
The real estate exposures are meaningful, but Moody’s views overall concentration risk as more material rather than real estate risk per se.
“So, on the one hand, Jordanian banks have real estate loans, both commercial and residential, slightly below a fifth of the total credit facilities,” says Theofilou. “Banks also face challenges in quickly disposing of properties, but within the context of a relatively lengthy foreclosure process. On the flipside, we see Jordanian banks having fairly high collateralisation, so they do hold a lot of collateral against the real estate exposures.”
The CBJ has earned plaudits for its regulatory oversight, with the IMF lauding its strengthening of the Financial Stability Committee, while refocusing its role on macroprudential policies and systemic risks.
Jordanian banks’ brisk uptake of digital technologies has also been a positive.
Last year, digital payment systems in Jordan recorded over 184 million digital transactions, exceeding $38bn in value. The CBJ has introduced an AI regulatory framework for the sector and the authorities are now working to burnish the country’s credentials as a fintech hub, based on a 90% plus internet penetration.
In the year ahead, Jordanian banks will be looking to find exposures to new lending opportunities, given the past risk aversion that has prevented them from building stronger growth avenues.
Projects beckon
Big new infrastructure projects could yet come to the fore as bankable opportunities for local players. For example, the National Water Carrier Project, costed at $5.8bn and aiming to increase water supply by 40%, is looking to achieve financial close this summer. It is the type of project that could prove significant in helping diversify local lenders’ exposure away from real estate towards infrastructure.
“If we see a lot of these infrastructure projects requiring financing coming to the market, then we could see a bit of a pickup in lending growth as well,” says Theofilou.
New lending opportunities will come from large corporates and infrastructure-related lending. Those will play the key role in any significant pickup in credit growth, says the Moody’s analyst, in contrast to the small- and medium-enterprise (SME) sector, which poses a different challenge for banks.
“The SME segment does represent a potential growth opportunity and it’s supported by policy focus, however its expansion is constrained by the operating environment. The sector is exposed to high overall credit risks, and when conditions are challenging, banks tend to be more cautious in lending to the SME markets,” says Theofilou.
So long as the regional conflict persists, banks will be inclined more towards caution than exuberance in their lending approaches. And yet that strong and stable inclination may be what serves them best in a notably turbulent year in the Middle East’s recent history.
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Oman tenders environmental survey consultancy contract
12 June 2026
Nama Power & Water Procurement Company (Nama PWP) has issued a tender seeking consultancy firms to provide environmental and seawater quality surveys under an ad hoc services contract.
The selected consultants will be appointed for a four-year period and engaged on an as-needed basis to undertake environmental survey work.
According to the tender notice, the scope of work includes environmental surveys, vertical profiling of seawater quality, seawater sampling and testing, environmental and social baseline studies, and bird and bat surveys.
Bids are due by 1 July.
Environmental and seawater studies are typically undertaken during the early development stages of power generation, desalination and other water infrastructure projects.
Oman’s project pipeline includes a series of large-scale independent power projects (IPPs) scheduled for delivery between 2027 and 2031, according to the seven-year plan released by Nama PWP in March.
Earlier in June, Nama PWP issued a supervisory consultancy tender for the 280MW Marsa solar IPP project in North Al-Batinah Governorate.
The project is scheduled to enter commercial operation in the first quarter of 2028.
The company is seeking project management and supervisory consultancy services during the construction, commissioning and testing phases of the project.
The bid submission deadline is 26 July.
> Be recognised among the best in the industry at the MEED Projects Awards 2026 …
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Emirates to offer passengers insurance amid travel warnings
12 June 2026
Dubai-based airline Emirates is to offer its own insurance product to passengers flying to or through Dubai, as it seeks to reassure travellers deterred by government advisories against travel to the region.
The airline’s president, Tim Clark, confirmed the move in an interview with the London-based Financial Times. He said Emirates was working with insurance companies to introduce a “reasonably priced” product that would guarantee passengers could get home regardless of whether they returned on Emirates or another carrier.
The move is designed to address concerns that travellers could become stranded if the conflict were to restart. More than three months after fighting began, several countries continue to maintain no-fly recommendations covering Gulf routes, leaving passengers unable to obtain conventional insurance for trips to or through the region.
“I think one of the big concerns is that if they get caught overseas and they can’t get back,” Clark said. The group was working with insurance companies “to do the right thing”, he added.
Emirates has played a leading role in supporting Dubai’s tourism sector since Iran began targeting the UAE with missiles and drones on 28 February.
In early June, the Department of Economy and Tourism told stakeholders attending its bi-annual City Briefing that the emirate worked closely with airports and aviation partners, including Emirates and FlyDubai, to ensure continued connectivity for travellers.
READ THE JUNE 2026 MEED BUSINESS REVIEW – click here to view PDFGCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.
Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
> AGENDA: Gulf races to reroute trade> EXPORT ROUTES: Regional war boosts oil and gas pipeline project activity> CURRENT AFFAIRS: UAE’s Opec departure fulfils multiple ends> MEED TOP 100: Middle East stocks recover unevenly> LEADERSHIP: Building the infrastructure that makes net zero possible> TRADE DEAL: UK-GCC trade deal talks concludeTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/17206867/main.jpg -
Conflict to push global growth to post-pandemic low
12 June 2026
The ongoing conflict in the Middle East is expected to drag global economic growth to its lowest level since the Covid-19 pandemic, with Gulf states bearing the heaviest burden of any region, the World Bank Group has warned in its latest Global Economic Prospects report.
Global growth is forecast to slow to 2.5% in 2026, down from 2.9% in 2025, with forecasts downgraded for two-thirds of economies. Economies in the Gulf directly affected by the conflict are expected to see growth collapse from 3.9% in 2025 to nearly zero this year, marking the steepest regional decline.
The closure of the Strait of Hormuz has severely disrupted energy markets, with Brent crude prices projected to average $94 a barrel in 2026, 36% above 2025 levels, assuming the worst disruptions ease by July. Fertiliser price increases are compounding the pressure, feeding through to food prices and pushing global inflation to an expected 4.0% this year, up from 3.3% in 2025.
The World Bank says downside risks remain substantial. Should energy supply disruptions prove more severe than currently assumed and be accompanied by significant financial stress, global growth could fall as low as 1.3% in 2026, with inflation climbing to 4.4%.
The World Bank is making up to $50bn-$60bn immediately available through existing instruments, including $25bn in pre-arranged financing, to support affected countries through social safety nets, fiscal capacity and working capital for businesses. More than 30 countries are actively working with the bank to enhance readiness under the response plan. If the conflict and its economic fallout persist, support could be scaled to $80bn-$100bn over 15 months.
Despite the severity of the near-term shock, the bank projects a significant Gulf rebound, with growth recovering to around 5% in 2027-28 as trade normalises and reconstruction spending begins.
READ THE JUNE 2026 MEED BUSINESS REVIEW – click here to view PDFGCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.
Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
> AGENDA: Gulf races to reroute trade> EXPORT ROUTES: Regional war boosts oil and gas pipeline project activity> CURRENT AFFAIRS: UAE’s Opec departure fulfils multiple ends> MEED TOP 100: Middle East stocks recover unevenly> LEADERSHIP: Building the infrastructure that makes net zero possible> TRADE DEAL: UK-GCC trade deal talks concludeTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/17204153/main.jpg -
Emaar announces $55bn Dubai project
12 June 2026
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Mohammed Alabbar, the founder of Emaar Properties, has released a statement saying that the Dubai-based real estate developer is about to announce a $55bn project in Dubai.
On his social media channels including Instagram and X, he said: “Emaar is preparing to unveil its most ambitious project yet: a development worth AED200bn (around $55bn), commanding an extraordinary vista that brings together, in a single frame, three of the city’s timeless icons – Burj Khalifa, Burj Al-Arab and Palm Jumeirah – complete with the finest essentials of modern living, in the city of Dubai.”
Emaar has delivered some of the world’s most ambitious real estate projects, including the world’s tallest tower, the 828-metre-tall Burj Khalifa, and the surrounding Downtown Dubai development.
Commenting on the new project, Alabbar added: “This is no ordinary new development. It is a landmark that takes its place in the legacy of the United Arab Emirates, writing a new chapter in the story of a nation that knows no limits to its ambition.”
In a statement on the Dubai Financial Market on 11 June, Emaar Properties said it “stands on the threshold of a historic announcement” and revealed more details about the project. It said it will have a total development value of AED200bn, with a gross floor area exceeding 4.5 million square metres.
It added that it will include a mix of landmark residential towers, signature villas and mansions, Grade-A commercial offices, world-class retail destinations, luxury hospitality, and civic and cultural amenities. Altogether, the development will accommodate a projected population of nearly 150,000 residents. The statement also said the development will be connected to proposed metro lines.
The exact location of the development was not revealed. Emaar has announced major projects in the past without giving precise locations. In June 2023, it announced the $20bn Oasis project. At the time, the details on the site’s location indicated it was situated in a prime location in Dubai, surrounded by high-end developments and within proximity to four international golf courses. It was later confirmed that the site sits between Damac Properties’ Lagoons development and Dubai Investment Park.
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