Wiiw forecasts modest growth for Central and Eastern Europe despite Iran war

The Wiener Institut für Internationale Wirtschaftsvergleiche (wiiw) released its summer outlook for 23 Central, Eastern and Southeast European economies. It projects average growth of 2.2 % in 2026 and 2.4 % in 2027, roughly triple the Eurozone rate. Poland leads with 3.7 % growth in 2026 and 2.9 % in 2027. Hungary is expected to rebound after its recent election, expanding by 1.7 % in 2026 and 2.6 % in 2027, while Romania may slip into a slight recession of –0.1 % and Slovakia will see marginal growth of 0.5 % in 2026. The outlook hinges on the Iran conflict not escalating, the Strait of Hormuz staying open and energy markets normalising. Private consumption, EU funds and defence‑industry investment are seen as key drivers. Ukraine’s growth remains weak at 1 % in 2026, rising to 2.5 % in 2027, hampered by Russian air attacks on energy infrastructure and higher fuel and fertilizer prices caused by the Hormuz blockade.