IMF warns poorer countries may need spending cuts or debt restructuring

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  The International Monetary Fund warned that many low-income developing countries may have to cut spending or restructure debt as they face the effects of an energy shock linked to the Iran war.

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  Heavily indebted oil-importing countries are among the hardest hit, with rising energy and food costs adding to existing debt and inflation pressures.

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  IMF deputy research director Petya Koeva Brooks said many low-income countries were already in debt distress or close to it.

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  The IMF said countries whose debt is unsustainable should seek orderly and timely restructuring rather than delay.

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  The fund urged governments to use narrow, targeted subsidies while rebuilding fiscal buffers and addressing rising debt.

Who

The IMF and low-income developing countries, especially heavily indebted oil importers.

What

The IMF warned that many may need to cut spending or restructure debt in response to the energy shock.

When

October 13, 2026.

Where

The warning was made during the IMF and World Bank Annual Meetings in Bangkok, Thailand.

Why

The Iran war-fuelled energy shock has raised energy prices and affected other goods, while many countries already face high debt and inflation.

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