ABUJA, Nigeria (VOICE OF NAIJA)-The World Bank has said it could mobilise up to $100bn in financial support over the next 15 months to help developing economies absorb the impact of escalating tensions in the Middle East.
The proposed increase in funding comes as the lender warned that the conflict could push global growth down to its weakest level since the COVID-19 pandemic, with rising energy prices, persistent inflation and tighter financial conditions weighing on economic activity.
In its latest Global Economic Prospects report obtained on Friday, the bank projected global growth to slow to 2.5 per cent in 2026, down from 2.9 per cent in 2025, with about two-thirds of economies recording downward revisions since its January outlook.
Growth is expected to rise slightly to 2.8 per cent in 2027 but remain below the average seen in the 2010s.
The World Bank said it was immediately making between $50bn and $60bn available through existing financing instruments, including $25bn in pre-arranged funding.
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The support is expected to strengthen social safety nets, stabilise government finances, and provide liquidity for businesses and farms affected by the crisis.
“To date, over 30 countries are actively working with the World Bank Group to enhance readiness and enable a rapid response to the crisis under this response plan. If the conflict and its economic fallout persist, the World Bank Group can scale up its support to $80–100bn over 15 months,” the lender stated.
The report noted that the closure of the Strait of Hormuz has significantly disrupted energy markets, with Brent crude oil prices projected to average $94 a barrel in 2026 about 36 per cent higher than in 2025 assuming major supply disruptions ease by July.
The bank also cautioned that higher fertiliser prices are likely to feed into food inflation, pushing global inflation to around four per cent this year, up from 3.3 per cent in 2025.
“Developing countries have faced a series of challenges over the last decade,” World Bank Group President Ajay Banga said.
“The impact differs by country, but the basic test is the same: protect people and preserve stability today, without giving up on growth and jobs tomorrow. In response to the current shock, we are providing liquidity where it is needed now, and we are ready with additional financing, guarantees and private-sector solutions if pressures deepen,” he added.
The report warned that downside risks remain elevated, noting that if energy supply disruptions worsen and trigger financial market stress, global growth could fall further to 1.3 per cent in 2026, while inflation could rise to 4.4 per cent.
Developing economies are projected to slow to 3.6 per cent growth this year, down from 4.4 per cent in 2025, before recovering to 4.2 per cent in 2027.
Gulf economies directly affected by the conflict are expected to see the sharpest slowdown, with growth dropping from 3.9 per cent in 2025 to near zero in 2026, before rebounding to about 5 per cent in 2027 and 2028 as trade and reconstruction activities resume.
Sub-Saharan Africa is also expected to be affected, particularly through higher inflation and rising food prices linked to fertiliser shortages and cost increases.
The World Bank’s Deputy Chief Economist and Director of the Prospects Group, Ayhan Kose, said the crisis should also be seen as an opportunity for governments to strengthen economic resilience.
“The conflict has taken a toll on global activity, but every crisis also brings an opportunity. This moment should be used to strengthen policy frameworks, invest in infrastructure, accelerate business-enabling reforms and mobilise private capital to support job creation at scale,” he said.
The report also highlighted rising fiscal pressures in developing economies, noting that aggregate government debt has increased from below 40 per cent of gross domestic product in 2010 to more than 70 per cent.
It warned that rising debt levels are limiting countries’ ability to respond to shocks and invest in long-term priorities such as infrastructure, healthcare, and education.