A United Nations Development Programme (UNDP) report published on Tuesday revealed that the US-Israel war against Iran has inflicted severe economic damage across the Middle East. The report projects that a month of conflict could shrink the region's GDP by approximately 3.7–6%, equivalent to a contraction of $120–194 billion, while leading to the loss of 3.7 million jobs and pushing an additional 4 million people below the poverty line.

Abdallah Al Dardari, UN assistant secretary-general and director of the UNDP Regional Bureau for Arab States, stated that the war has highlighted the "fragility in the Arab economy." He emphasized that each day of delay in ending the fighting has negative repercussions on the global economy. The report notes that increases in poverty rates are concentrated in the Levant and fragile states like Sudan and Yemen, where baseline vulnerability is highest and economic shocks translate more rapidly into welfare losses.

The report, based on projections of a "short but intense conflict lasting for four weeks," warns that the impact could worsen if the war drags on longer. Iran's attacks on Gulf energy infrastructure and restrictions on oil and gas exports through the Strait of Hormuz have already tightened oil supplies, driving up Brent crude prices by 4.7% to over $118 per barrel. These "risks in strategic maritime corridors" are causing knock-on effects on inflation, trade flows, and global supply chains, undermining livelihoods in the region's "interconnected economies."

Lebanon is identified as particularly impacted, having been drawn into the war after Hezbollah struck Israel in retaliation for the US-Israeli killing of Iran's Supreme Leader Ayatollah Ali Khamenei on February 28. The report describes "ongoing air strikes and evacuation orders … already causing widespread destruction of residential areas, transport infrastructure, and public services, alongside large‐scale displacement," exacerbating the humanitarian crisis in the region.

Source: www.aljazeera.com