In its April regional outlook, the International Monetary Fund (IMF) maintained Tunisia’s 2026 growth forecast at 2.1%, but warned that the economy remains highly exposed to external shocks, particularly energy price volatility linked to the war in Iran and disruptions around the Strait of Hormuz.
In its Regional Economic Outlook for the Middle East and Central Asia, the IMF said Tunisia’s modest growth projection assumes a gradual normalization of global energy markets and no further escalation in regional hostilities.
However, it cautioned that a prolonged or renewed spike in oil prices could quickly derail that baseline.
The IMF noted that Tunisia, a net energy importer with limited fiscal buffers, is especially vulnerable to swings in global prices, the Fund said. Higher energy costs would raise production expenses, widen the trade deficit and weigh on domestic demand, potentially pushing growth well below current projections.
Energy prices under scrutiny
The Fund said holding domestic fuel prices steady to protect households is absorbing the shock in the short term but significantly raises subsidy costs, risking a further widening of the budget deficit. It estimated that energy-related pressures could increase the fiscal gap by around 0.5 percentage point of GDP this year
Energy imports already account for a large share of Tunisia’s trade deficit, and persistent high prices could renew pressure on foreign-exchange reserves and the dinar, it added.
While inflation has slowed to about 5% year-on-year, the IMF cautioned that sustained energy price shocks could reignite inflation through higher transport, food and import costs, eroding purchasing power and complicating monetary policy.
MENA growth revised downward
The IMF also sharply downgraded its 2026 growth forecast for the Middle East and North Africa (MENA) region to 1.1%, as the war disrupts oil and gas exports from the Gulf.
Iran, Iraq, and Qatar are expected to be the most affected, according to the World Economic Outlook report, which revised down its regional growth forecast from 3.9% in January.
Growth is expected to rebound next year, provided energy production and transport normalize in the coming months. The region is projected to grow by 3.2% in 2025.
The ongoing conflict, which has lasted for weeks, has damaged production facilities and nearly shut down the Strait of Hormuz.
Iran’s GDP, hit by heavy US-Israeli strikes, is expected to contract by 6.1% this year, a sharp downgrade of 7.2 percentage points from January forecasts.
Qatar’s economy is projected to contract by 8.6% due to severe damage to its main liquefied natural gas facility, while Iraq’s economy is expected to shrink by 6.8%.
“For commodity-exporting countries directly affected by the conflict, reduced production and exports imply a major downward revision of GDP growth forecasts for 2026,” the report said.
