The IMF is the primary publisher of brainy perspectives on the economies of countries,

regions, and the world. The latest series of IMF assessments of the global economy –

namely The World Economic Outlook (WEO) and the Global Financial Stability Report

(GFSR), both of April/May 2025 – open with the acknowledgment that “policy

uncertainty” is testing “global resilience” (WEO). It notes that several fragilities,

albeit already observed last year, “could amplify adverse shocks, abruptly tightening

financial conditions” (GFSR).

Customarily, the first WEO chapter, under the standard title of Global Prospects and

Policies, puts emphasis on basic advice to all 188 member countries. This year, the

recommendations and their indented main target audiences are not very new, but in

global context, stinging. This WEO advice of April 2025 can be subsumed under the

message that there is “a rise in uncertainty that is once again testing the resilience of

the global economy” and that, therefore, the “global economy is at a critical juncture.”

Further advices and detailed observations in the World Economic Outlook include

positions on well-defined up-and-coming geoeconomic “prospects”, which

zoom in on new challenges such as the management of the AI shock and associated high increases in electricity needs of developed economies, or the particularities of the advanced-age (“silver”)

economy and the global migrant economy.

In its comments on rising uncertainty, the IMF specifically mentions the big MAGA-

related surprise of a resetting of the global trade system by major policy shifts, pointing

first to the new tariff regime announced by the United States. The WEO seeks to

mentally counter this unexpected backward turn in development of the global real

economy by emphasizing the values of active trade, global productivity gains, and

central bank independence as anchor points of the global system. Having stood as core

enabler and guardian of the world’s legacy economic system of the past 80 years, the

IMF leadership predictably warns of economic downside ramifications of hampering with

these parameters.

When it comes to this year’s regional outlook for what is arguably the world’s least stable geopolitical region between Kazakhstan and Mauritania, which includes Lebanon, the picture is both unwieldy and mostly discouraging. Assessments include 32 countries in the Middle East, North Africa, Caucasus and Central Asia, (MENA-CCA) which are regionally and analytically grouped into numerous sub-strata that overall betray more divergences than commonalities between all 32 countries and even

between countries in the same sub-stratum, e.g. non-GCC oil exporting states Algeria,

Iran, Iraq and Libya.

For this overlarge and unequal region, the message of uncertainty is even more upfront

and ominous than for the world as a whole: a “spike in global economic uncertainty in

the first months of 2025 is starting to affect the economies of the Middle East and North

Africa (MENA) and Caucasus and Central Asia (CCA)”, the IMF regional economic

outlook for MENA and CCA says, confessing that in comparison to its views from only

six months ago, “expectations of weaker growth and wider economic imbalances than

foreseen at the time of the October 2024,” due to, among other factors, “a slower-than-

anticipated resolution of conflicts in the region”.

In terms of numerical GDP development, the data table for the MENA countries shows

2.6 and 3.4 percent growth projections in 2025 and 2026, which represent downside

revisions of 1.4 and 0.8 percentage points from last October. For the sub-group of

emerging market, middle-income, oil importing MENA (theoretically meaning Egypt,

Jordan, Morocco, Tunisia, Palestine and Lebanon but de-facto projecting only data for

the first four countries), the downside revisions since last October are 20 and 50 basis

points to new projections of 3.6 percent growth in 2025 and 4.0 percent in 2026.

A contraction of 50 basis points in projected GDP growth for the sub-region may not

sound huge but it has to be recognized that this estimate would not include Lebanon,

nor the Palestinian territories of West Bank and Gaza, for which the IMF wisely abstains

from speculating on GDP development numbers over the coming years. As the

statistical appendix to the WEO notes, data shown for Lebanon since 2022 are staff

estimates and “estimates and projections for 2025–30 are omitted owing to an unusually

high degree of uncertainty.” While consisting of data uncertainty a tiny nutshell, this

seems to be the most pertinent information that the World Economic Outlook offers on

Lebanon.

The press conferences at the spring meeting in Washington and the regional meeting in

Dubai were no more committal on the peace building needs and grievances of Middle

Eastern Arabs than the shocked statements at the Marrakesh World Bank Group’s

meeting in October 2023. References to economic downside potentials of conflict risk in

MENA and CCA countries made by IMF representatives when discussing the 2025

regional outlook in Dubai at the beginning of May, although not emphasized in blunt

words, outweighed tangible recommendations for countries in the region’s conflict areas

and specific new insights on solutions for conflict-hit economies.

When one searches what else the Regional Outlook has to say about Lebanon, one

finds a similar number of mentions as for Egypt (28 versus 31), of which about half are

in tables and footnotes. Perhaps ironically, a particular mention of past IMF engagement

with the country’s financial sector, is saying that in the post-2006 conflict environment of Lebanon, “the IMF provided capacity development to improve public financial management, assess banking sector soundness, and improve government finance statistics”.

On a side note, while the primary commonality between WEO and Regional Outlook

publications is the concept of “uncertainty”, with unpredictable downside risks

(elaborating mostly on dangerous impacts of uncertainty but not dedicating much

energy to the distinctive definitions of uncertainty versus risk by economist Frank Knight

a century ago, or the uncertainty-related theories of John Maynard Keynes), the

Regional Outlook features a second chapter that is dedicated to this concept and its

economic implications.

The two-pronged adverse impacts of uncertainty on economic behavior, according to

the IMF academics, entail increased price volatility and borrowing costs in a (financial)

“market channel” and decreased consumption and decreased investment in a “real

channel”. When compared with the rest of the world, domestic uncertainty shocks –

such as wars and conflicts – in the MENA and CCA regions have “larger and longer-

lasting effects on the real economy”.

The chapter draws on data from an index developed in 2022 that according to the IMF

is based on “counting the frequency of the word ‘uncertain’ (or the variant) in Economist

Intelligence Unit country reports.” Perusing this index’s page on Lebanon, the WUI

reveals nothing less (or more) than a record high EIU perception of Lebanese

uncertainty in the summer of 1964, as well as smaller spikes in the quarterly EIU

report’s usage of the term uncertain or a variant thereof that in descending order of

recorded magnitude occurred in 2018 (third quarter), 2013 (first and third quarter), 1967

(second quarter), 1987 (second quarter) and 1995 (fourth quarter).

By a derivative gauge, a pedestrian accounting of mentions of “uncertainty” in WEO

reports, the rise of uncertainty in the world is indeed severe: while at the, largely by the

IMF unforeseen, brink of the Great Recession of 2007-09, the number of mentions in

the anecdotally examined Global Prospects and Policy chapters of the WEO was below

20, the 2025 first WEO chapter contains the word 76 times, an increase of around 350

percent from 17 mentions in spring 2007. Uncertainty generally is something that most

economists consider as escaping attempts of quantification.

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