IMF sees Kuwait economy contracting 0.6% in 2026

Kuwait’s economy is expected to contract in 2026 before returning to growth in 2027, as regional conflict disrupts energy markets and trade flows, the International Monetary Fund (IMF) said on Tuesday.

In its latest World Economic Outlook, the IMF said Kuwait is among a group of economies, including Iran, Iraq, and Qatar, expected to contract in 2026 due to damage to energy infrastructure and limited access to alternative export routes.

The IMF revised Kuwait’s growth forecast for 2026 down to -0.6 per cent. Growth is projected to recover to 2.8 per cent in 2027, assuming normalisation of energy production and transportation networks across the region.

The Fund said Kuwait, like other oil-exporting economies, faces pressure from disruptions to energy infrastructure and shipping routes, particularly those linked to key corridors such as the Strait of Hormuz.

However, it added that the outlook remains uncertain, with risks tied to the duration and intensity of the conflict and its impact on global energy markets.

Attribution: Amwal Al Ghad English