In light of the repercussions of the war involving Iran, the OECD has downgraded its economic outlook for the global economy. Assuming a limited disruption caused by the conflict in the Gulf region, the OECD projects a slowdown in global economic growth from 3.4 percent last year to 2.8 percent in 2026. For Germany, the OECD anticipates growth of 0.7 percent, according to the economic outlook published on Wednesday. In 2025, Germany’s economy grew by 0.3 percent, according to OECD figures.
However, should the disruptions caused by the war persist for an extended period, global growth—according to OECD estimates—will slow significantly: to 2.1 percent in 2026 and 1.8 percent in 2027. This could push some economies “to the brink of recession,” the report states. The repercussions would be felt worldwide, particularly by developing nations with limited energy reserves.
The dependence of economies on a single choke point underscores the need to further bolster supply chain resilience, the OECD emphasized, pointing to the de facto closure of the Strait of Hormuz. “We must invest more—with greater urgency than ever—to break free from our dependence on imported fossil fuels,” the report concludes.
The OECD criticized blanket measures aimed at providing relief to households and businesses in the face of high energy prices. “Measures such as tax cuts and price caps typically weaken incentives to save energy,” the organization emphasized. This is “particularly unwelcome” during an energy supply crisis and could, moreover, prove costly.
For Germany, the OECD projects rising public and private investment, driven by substantial investment needs and facilitated by more flexible fiscal rules. However, global uncertainty is expected to weigh on investment in export-oriented companies. The OECD called for accelerating the reduction of red tape and the digitalization of public administration.
Over the past two years, trade protectionism and intensifying competition from China in key markets have weighed on exports. In March 2026, however, the value of goods exports was two percent higher than in the corresponding period of the previous year. The OECD attributed this to growing exports to other EU countries, which offset declining exports to the USA and China.
AFP translated by Blackout News