AFP, United Nations

A month of war in the Middle East could wipe out all the economic growth that Arab countries achieved last year, and will likely spark a “sharp economic contraction” in Iran, the United Nations said Tuesday.

A series of reports by the UN Development Programme (UNDP) came in the war’s fifth week as all sides continue to exchange threats despite US claims that negotiations are ongoing.

“The recent military escalation in the Middle East is exposing the structural vulnerabilities of the Arab States region,” the agency said, adding that “GDP is estimated to decline by approximately 3.7 to 6.0 percent” across the region.

That would represent a total GDP loss of $120 billion to $194 billion -- or more than “exceeds the cumulative regional GDP growth achieved in 2025.”

For Iran, the agency said the conflict was likely “to trigger a sharp economic contraction,” with economic simulations suggesting that “real GDP growth could decline by between 8.8 and 10.4 percentage points, relative to a no-war baseline scenario.”