World Bank Sees East Asia and Pacific Growing 4.5 Percent and MENAAP Oil Importers 4.3 Percent
East Asia and Pacific is projected to grow 4.5 percent in 2026, while oil importing economies in the Middle East, North Africa, Afghanistan and Pakistan (MENAAP) are set to accelerate to 4.3 percent from 3.9 percent in 2025, the World Bank said in 2 regional updates published on 6 October. On our calculation, that puts MENAAP’s oil importers within 0.2 percentage points of the East Asia and Pacific pace.
East Asia and Pacific: AI supply chains lift the outlook
Several East Asian economies grew faster than anticipated in 2026, propelled by the manufacture and export of high-tech goods behind the global surge in AI-related activity. The bank raised its 2026 forecast for Viet Nam by 1.1 percentage points to 7.4 percent, for Malaysia by 0.7 points to 5.1 percent and for Thailand by 0.7 points to 2.0 percent. China, the region’s largest economy, is growing at 4.4 percent, with domestic demand constrained by a soft labour market and adjustment in the property sector. Pacific Island countries, exposed to high energy prices with limited buffers, are growing at 2.2 percent, 0.5 points slower than previously anticipated.
East Asia and Pacific: 2026 growth forecasts, October 2026
| Economy | 2026 forecast | Revision, points | Previous forecast |
|---|---|---|---|
| Viet Nam | 7.4% | +1.1 | 6.3% |
| Malaysia | 5.1% | +0.7 | 4.4% |
| Thailand | 2.0% | +0.7 | 1.3% |
| Pacific Island countries | 2.2% | -0.5 | 2.7% |
Previous forecasts are our calculation, the October forecast minus the stated revision. China, 4.4 percent, and the regional 4.5 percent were published without a revision figure.
Regional growth is expected to average 4.4 percent a year over 2026 to 2028. Growth is slowing, but considerably less than previously anticipated. As a major net oil importer, the region saw a larger rise in inflation from high energy prices than other regions.
MENAAP: oil importers accelerate, 7.8 percent rebound projected for 2027
For MENAAP as a whole, output is projected to contract 2.1 percent on average in 2026 after growth of 3.3 percent in 2025, a swing of 5.4 percentage points on our calculation. The impact is concentrated among oil exporters affected by the closure of the Strait of Hormuz, where lower export volumes cut output and government revenue, and economies of the Gulf Cooperation Council are projected to contract by an average of 4.3 percent. Oil importing countries have remained comparatively resilient, the report said. If the conflict subsides by the end of 2026, regional growth excluding Iran is projected to rebound to 7.8 percent in 2027, driven largely by the recovery of hydrocarbon production and exports. A regional recovery is not guaranteed and will require sustained policy efforts, the report added.
MENAAP growth projections, October 2026
| Group | 2025 | 2026 | Change, points |
|---|---|---|---|
| Oil importers | 3.9% | 4.3% | +0.4 |
| MENAAP region | 3.3% | -2.1% | -5.4 |
Changes are our calculation. The 2027 rebound to 7.8 percent excludes Iran and assumes the conflict subsides by the end of 2026.
On our calculation, oil importers’ 4.3 percent puts them 6.4 percentage points ahead of the MENAAP figure for 2026.
The AI dividend in both regions
Both updates make AI their special theme. In East Asia and Pacific, only 13 percent of jobs fall in the complex thinking category where AI is most effective at supporting workers, against 39 percent in advanced economies, and the bank sees the largest near-term gains from “Small AI”, the adoption of existing, more accessible tools. In MENAAP, fewer than 10 percent of jobs face near-term automation risk, while 13 to 20 percent carry significant potential for AI to raise productivity. The MENAAP report names Saudi Arabia and the United Arab Emirates as AI leaders able to share their experience in model development and governance, with the Gulf’s computing capacity, the region’s linguistic richness and talent across middle-income economies together seen as an opportunity to build the foundation of a regional AI ecosystem. The 2 measures are not directly comparable: East Asia and Pacific’s 13 percent counts jobs requiring complex thinking, while MENAAP’s 13 to 20 percent counts jobs with significant augmentation potential.
Why it matters: East Asia and Pacific’s growth is being carried by its role in AI supply chains, with Viet Nam, Malaysia and Thailand all revised up, while MENAAP’s oil importers are accelerating rather than slowing. Across the wider region, the same report says growth excluding Iran could rebound to 7.8 percent in 2027 if the conflict subsides by the end of 2026, driven largely by recovering hydrocarbon production and exports, and names Saudi Arabia and the UAE as the region’s AI leaders.
Outlook: The IMF’s World Economic Outlook on 13 October is the next global read. On our reading, oil importers lead the region this year at 4.3 percent, while the projected 7.8 percent rebound in 2027 rests on hydrocarbon production and exports recovering once the conflict subsides.
Sources: World Bank, IMF, The Edge.
