Middle East crisis: W’Bank readies $100bn support for developing nations

The World Bank is prepared to scale up financial support to developing countries to as much as $100 billion over the next 15 months, aiming to help them navigate the economic repercussions of the escalating Middle East crisis. This commitment comes as the institution forecasts that the conflict could drive global economic growth to its slowest pace since the COVID-19 pandemic, fueled by soaring energy prices, increasing inflation, and stricter borrowing conditions.

In its latest Global Economic Prospects report, the World Bank projects global growth to decelerate to 2.5% in 2026 from 2.9% in 2025, with downward revisions for approximately two-thirds of the world's economies since January. Modest recovery to 2.8% is anticipated in 2027, yet it will remain below the average growth rate of the 2010s.

The bank is immediately allocating between $50 billion and $60 billion through existing financial instruments, including $25 billion in pre-arranged funding. These resources are intended to bolster social safety nets, strengthen government finances, and provide essential liquidity for businesses and farms impacted by the crisis. Over 30 countries are currently collaborating with the World Bank Group to prepare for and respond rapidly to the crisis under this plan.

World Bank Group President Ajay Banga stated, “Developing countries have faced a series of challenges over the last decade. 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.” The report also highlights significant downside risks, warning that worsening energy supply disruptions could further reduce global growth to 1.3% in 2026 and push inflation to 4.4%.

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Developing countries have faced a series of challenges over the last decade. 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.