United Nations warns developing countries bear harshest economic impact from US-Israel war on Iran. In its latest World Economic Situation and Prospects Report, UN cuts 2026 growth forecast to 2.5 percent due to higher energy prices and weaker global trade.
The report highlights that low-income families in developing nations face the greatest pressure as food and energy costs rise faster than wages. Poorer governments struggle to respond due to declining international aid and mounting debt burdens.
Countries with reduced aid and rising debts have less money for health, education, and social protection spending. The Middle East region is experiencing significant economic disruption from both energy shocks and infrastructure damage affecting oil production, trade, and tourism.