Does the world enter into stagnation?

The world is not, at this stage,overall stagnationin the strict sense of generalized zero growth. Major institutions continue to anticipate an increase in world GDP in 2026. But they also describe a past international economy on thelower growth rate, more unequal and more vulnerable to shocks. The IMF forecasts a further increase in world GDP of3.3 per centin 2026, while the World Bank estimates that global growth clearlyRetrogradeSince the pandemic, the pace has been too low to reduce poverty sufficiently and create enough jobs. In other words, the right word is not yet « stagnation » in the accounting sense, but rathersustained slowdownwith the risk of slipping into a phase of stagnation, evenstagflationif the energy shock persists.

The current context, however, changes the nature of the debate. The conflict in the Middle East, the tension around the Strait of Ormuz and the upsurge of oil are reviving an old macroeconomic fear: that of a world where growth slows as inflation returns. The Strait of Ormuz carried about 202420 million barrels a day, or close to20% of global consumption of petroleum liquids. Since the enlargement of the war, energy markets have become very tense and the Brent has closed the13 March 2026to$103.14the barrel, above the $100 threshold for two consecutive sessions. In such an environment, the question is no longer simply whether global growth remains positive, but whether it becomes too weak to absorb debt, sustain investment and preserve purchasing power.

What stagnation really means

In economics, stagnation refers first of all to a situation ofvery low or zero growthfor an extended period. In its most discussed version, thesecular stagnationIt corresponds to a world where private investment remains too low, where excess savings weighs on demand, where natural interest rates become very low, and where even low policy rates are no longer sufficient to boost activity in a sustainable manner. The European Commission sums up this idea as a mixture oflow growth, low inflation and low interest rateslong term. OECD work more precisely defines age-old stagnation as a situation where near-zero rates no longer stimulate demand enough, which also depresses the growth potential itself.

This concept must be distinguished from therecession, which is a contraction of activity,stagflation, which combines soft growth and high inflation. The world today does not yet look like a pure secular stagnation, because inflation is not long-term too low and some countries maintain robust growth. On the other hand, several ingredients of a soft growth regime are present: demographic ageing, insufficient productivity gains, hesitant investment, very high public debt, geopolitical fragmentation and the return of energy shocks. If expensive oil settles down, then the risk is not just stagnation, but a more difficult cocktail to handle:soft growth + more persistent inflation.

There are precedents, but no true copy

The classic example remains Japan. Economic policy work in Europe is reminiscent of the country’s decades of low growth, very low inflation and sustained low rates. Other studies link this trajectory to demographic ageing and structural weakening of demand. This example counts today because it shows that a developed economy can remain weak for a long time without falling apart, but gradually losing momentum, investment and confidence.

The other precedent often cited is that of Europe after the global financial crisis and the sovereign debt crisis. The euro area has long accumulated low growth, inflation too low and disappointing productivity. This recent past explains why European economists take energy shocks very seriously. An analysis by the Bank of France shows that a sustained oil shock is deteriorating the financial ratios of manufacturing firms, with effects that may persist.2 to 3 years, particularly in the energy sectors. In an already slowed economy, this type of shock acts as an additional brake on investment and employment.

The world is not frozen, but it slows down

International institutions today describe a world that is still moving forward, but less well. The IMF sees global growth in3.3 per centin 2026 and3.2 per cent2027. The World Bank insists that global growth has shifted to a slower pace since the pandemic and is now insufficient to meet development and employment needs. The difference between the figures does not reflect a frontal contradiction: it mainly reflects different methods and schedules. The converging diagnosis is elsewhere: growth does not disappear, but it becomesless carrier, more fragile, and more dependent on a few poles of resistance.

The current risk comes from the overlay betweenstructural weaknessesandgeopolitical shock. Structural weaknesses are known: ageing, low productivity, less dynamic investment, less fluid world trade and high public debt. The geopolitical shock acts as a multiplier. The conflict in the Middle East is increasing energy prices, tending logistics chains, complicating central bank arbitrations and weighing on the morale of both businesses and households. This does not mechanically create global stagnation. On the other hand, this reduces the margin of error of governments and central banks, in a world that was already growing slower than before.

Some terms to keep in mind

These concepts are particularly important today because they allow us to see why positive growth can actually be insufficient. An economy can avoid recession while giving the feeling of trampling. It is even so often that a period of relative stagnation is set up: not by a brutal collapse, but by a succession of years too weak to raise the standard of living frankly.

France: not stagnation, but too narrow growth

France is not currently in stagnation in the strict sense. GDP grew by0.9 %The Bank of France estimates an increase in GDP between0.2 per cent and 0.3 per centin the first quarter of 2026. For the whole of 2026, the Bank of France is projecting growth of1,0 %. It’s not a standstill economy. But it is also not a sufficient pace to quickly remove unease over purchasing power, productive investment or public finances.

The risk to France lies in its vulnerability toenergy shocksand the sustainable weakness of European growth. The euro area remains soft, European industry has already started 2026 on a degraded note, and higher energy costs threaten manufacturing sectors first. For France, this means positive but vulnerable growth: enough to avoid recession, not enough to dispel the feeling of stagnation in part of the economic fabric. In this context, the conflict in the Middle East acts less as a single cause than as a revealing of the weaknesses already present.

United States: slowdown more than stagnation, but with a real risk of wear and tear

Nor are the United States stagnant in the strict sense. But the signal sent by the end of 2025 is clear: US GDP grew at an annualized rate of only0.7 %in the fourth quarter 2025, after4.4 %the previous quarter. This stall does not alone announce a lasting stagnation, but it shows an economy that enters in 2026 with less momentum than expected. At the same time, the return of expensive oil complicates the central bank’s task: slowing down the economy without reviving inflation becomes more difficult when energy increases as a result of external conflict.

The American paradox is known. The country remains more dynamic than Europe thanks to innovation, technology and a more flexible labour market. But it is also very politically sensitive to gas prices and geopolitical shocks. In this context, the right word is not American stagnation, butenergy-intensive slowdown. If oil remained over $100 long and uncertainty continued, the risk would be that the United States would move towards weaker growth with more sticky inflation, which would be more like a stagflation phase than a classic secular stagnation.

Middle East: an energy-exporting region can also be weakened

The Middle East should not only be read as a region that benefits mechanically from the increase in oil. Prior to the enlargement of the conflict, the IMF forecasted growth of3.9%in 2026 for the Middle East and Central Asia region, while the UN Regional Economic Commission planned3.7 %for the Arab region. These figures show that there was still a recovery path, driven by oil production, domestic demand and some reforms. But war changes the nature of the risk. An energy-exporting region can gain in the short term from revenues, while losing on logistics, security, investment, insurance, tourism and trust.

The current conflict is particularly dangerous because it affects thearteriesRegional economy: Ormuz Strait, port hubs, air traffic, supply chains and security perception. For the Gulf monarchies, therefore, the problem is not only the price of the barrel, but the possibility that their economies will be seen as more risky. However, when a geopolitical shock begins to degrade the function of a trading, financial and tourist platform, it can curb investment even in oil-rich countries. Again, we do not necessarily talk about immediate stagnation, but about weakening regional dynamism.

Lebanon: the country where the word stagnation is almost too weak

The Lebanese case is separate. For Lebanon, the debate is not just about stagnation. It is about the exit of acollapseextended. The World Bank reported in January 2026 that the Lebanese economy had finally recorded positive growth in 2025, with a real expansion of3.5 %, after years of cumulative fall since 2019. Inflation slowed sharply,15.2%in 2025, and is expected to return to a one-digit level in 2026 for the first time since 2019. The IMF, however, continues to stress the urgency of banking, fiscal and institutional reforms to restore sustainable growth.

But this very fragile improvement is once again being met by regional war. In March 2026, the United Nations launched an emergency appeal for Lebanon, where more800,000 peoplehave been displaced by the resumption of the war and where aid capacities are already severely weakened by the financial crisis, the explosion of the port and the accumulated destruction. For a net energy-importing country, highly dependent on transfers, tourism, confidence and logistical flows, the return of a regional shock is particularly destructive. Lebanon therefore does not enter into a classical stagnation; he might rather see avery precarious recoverybreak before being consolidated.

So, is the world in stagnation?

The most rigorous answer is no,not yet in the strict sense, but the world is more clearly entering ainsufficient and more vulnerable growth phase. The overall figures remain positive. Yet the background becomes more worrying: structural slowdown, disappointing productivity, high debt, more fragmented trade, ageing, and now energy shock linked to the Middle East. In such a context, many savings do not stop, but move too little to improve the standard of living quickly or to absorb shocks calmly. It is precisely this grey area that nourishes the feeling of stagnation.

The real risk is therefore not just stagnation in the academic sense. It is the establishment of a world where growth is becoming too weak to ease social tensions, even as energy, maritime routes and geopolitics begin to produce inflation. In this scenario, the big question is no longer simply how much does the world grow?

Sources and documents consulted

1. IMF Global Outlook, January 2026 update.
2. World Bank World Economic Outlook, January 2026.
3. Definition and debate on secular stagnation, European Commission and OECD.
4. France: Insee national accounts, economic conditions and Bank of France projections.
5. United States: Fourth Quarter 2025 GDP, Bureau of Economic Analysis.
6. Energy and Ormuz: U.S. Energy Information Administration and recent market data.
7. Lebanon: World Bank, IMF and United Nations humanitarian appeal.

Keyword:stagnation

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Description:Does the world enter into stagnation? Definition, examples, figures and impact of the Middle East conflict on the world economy.

Extract:The world is not yet in global stagnation in the strict sense, but is evolving in a weaker, more fragile and more shock-prone growth regime. The conflict in the Middle East, the tension around the Strait of Ormuz and the rise of oil rekindle the risk of a dangerous mixture between soft growth and inflation. From France to the United States, from the Gulf to Lebanon, the challenge is no longer just growth, but its quality, strength and ability to withstand a sustainable energy shock.

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Exact number of words of the body: 2644