Even if the conflict is ‘short but intense’, countries such as Sudan, Yemen and Lebanon will see significant increases in poverty rates.
Published on 31 March 2026
According to the United Nations, the US-Israel war over Iran and its impact throughout the Middle East has had a devastating impact on Arab countries, pushing millions into poverty.
A United Nations Development Program (UNDP) report published on Tuesday said gross domestic product (GDP) in the region is projected to decline by about 3.7 to 6 percent after a month of fighting, equivalent to a contraction of $120 billion to $194 billion.
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Abdullah Al Dardari, UN Assistant Secretary-General and Director of the UNDP Regional Bureau for Arab States, said 3.7 million jobs would be lost and nearly four million more people in the region could fall below the poverty line, noting that the war had exposed “the fragility in the Arab economy”.
The report was based on projections of “a short but intense conflict lasting up to four weeks”, indicating that the impact of the war, which has seen Iran attack Gulf energy infrastructure and squeeze oil and gas exports through the Strait of Hormuz, was likely to be even greater if it lasted longer.
Brent crude futures rose 4.7 percent to more than $118 a barrel on tight oil supplies, the report said, adding that “risks in strategic sea corridors” had “impact on inflation, trade flows and global supply chains” that could undermine livelihoods in the Middle East’s “interconnected economies.”
It said the increase in poverty rates was “concentrated in the Levant and fragile countries (Sudan and Yemen), where baseline vulnerabilities are highest and shocks translate more strongly into welfare losses”.
Lebanon, which was dragged into the war after Hezbollah attacked Israel in retaliation for the US-Israeli assassination of Iran’s Supreme Leader Ayatollah Ali Khamenei on February 28, is particularly affected, the report said, “due to ongoing airstrikes and evacuation orders … already leading to mass displacement as well as widespread destruction of residential areas, transport infrastructure and public services”.
“We hope the fighting will stop tomorrow, because every day’s delay has a negative impact on the global economy,” Al Dardari said.
