London, Dec 12, IRNA -- Iran's economic growth is expected to be the second highest in the Middle East and the 25th largest in the world next year, according to the latest forecasts from the Economist Intelligence Unit (EIU), published Thursday.

The slowest-growth regions were predicted to be Western Europe and Latin America with severe imbalances in the US economy posing the biggest risk to the world economy.

In forecasts covering more than 190 countries, the EIU said that GDP in Iran would grow by 5.4 percent in 2003, second to only Qatar in the Middle East, whose rise was put marginally higher at 5.5 percent.

The rises in Kuwait and the United Arab Emirates were predicted at only 3 percent, Saudi Arabia at 2.5 percent and Oman at 1.3 percent.

Elsewhere in the Middle East, Jordan was the third highest 3.2 percent, while Egypt was put at 1.8 percent, Israel at 1.6 percent, Lebanon and Oman both at 1.3 percent. Iraq's economy was forecast to contract by 1.5 percent.

The EIU said that the entire global outlook is being affected by concerns about the possibility of a US-led war against Iraq and that the uncertainty about the impact had pushed oil prices up by about six dollars per barrel (dpb) for much of 2002.

"If contact takes place in 2003, we predict that OPEC will increase oil production to make up for the lack of Iraqi production and that oil prices will rise to about 35-40 dpb (dollars per barrel) -- but only for a short time," it said.

The highest growth rates were predicted in Sub-Saharan Africa, with nine countries in the top 20, led by Equatorial Guinea, Chad and Mozambique with forecasts of 12.5 percent, 9.8 percent and nine percent respectively.

In Western Europe, the lowest rises were expected in Portugal (0. percent), Switzerland (0.8 percent), Germany (1 percent), the Netherlands (1.1 percent), Belgium (1.3 percent), Italy (1.4 percent), Austria 1.5 percent and France (1.7 percent).