The World Bank`s latest Middle East, North Africa, Afghanistan & Pakistan (MENAAP) Economic Update projects modest growth across the region, with Afghanistan expected to benefit from greater regional trade integration and agricultural recovery, though significant challenges remain.

The report forecasts regional growth at 2.8 percent in 2025 and 3.3 percent in 2026, driven largely by easing oil production cuts in Gulf countries and stronger private investment in non-oil sectors. For Afghanistan, the Bank noted tentative signs of economic stabilization under the Islamic Emirate of Afghanistan (IEA), supported by improved revenue collection, a stable exchange rate, and modest export gains.

However, limited international recognition, reduced foreign aid, and continued restrictions on women`s participation in public life continue to constrain broader growth.

The MENAAP region continues to record the world`s lowest female labor participation rate, with only one in five women employed despite substantial progress in education.

"I urge bold action-not partial measures," said Ousmane Dione, the World Bank`s Vice President for the Middle East, North Africa, Afghanistan & Pakistan region. "To unlock the full potential of women in the region, we must tackle every barrier to their inclusion with comprehensive measures."

For Afghanistan, the report emphasizes that empowering women and expanding private sector opportunities - especially in agriculture, trade, and small-scale enterprises - could significantly improve household incomes and long-term resilience.

"Removing barriers that prevent women from accessing jobs could boost GDP per capita by as much as 20 to 30 percent in some economies," added Roberta Gatti, the region`s chief economist.

While regional outlooks have improved, the World Bank cautioned that ongoing conflicts, displacement, and global trade volatility continue to pose serious risks to recovery - particularly for fragile and aid-dependent economies like Afghanistan.