IMF: Middle East and North Africa Economies Face Uncertainty Amid Geopolitical Tensions and Conflicts
The Middle East and North Africa region's economies are facing uncertainty due to ongoing geopolitical tensions, according to Jihad Azour, the International Monetary Fund (IMF) director for the Middle East and Central Asia department.
The IMF has revised down its growth outlook for the region due to conflicts in Gaza and Sudan, as well as a recent cut in oil supplies by Gulf countries.
The economic activity in Gaza has come to a standstill, and the IMF estimates that economic output in the West Bank and Gaza contracted by six percent last year.
The International Monetary Fund (IMF) predicts a 2.7% growth rate for the Middle East and North Africa (MENA) region in 2021, which is 0.2 percentage points lower than its previous forecast.
The IMF warns of heightened risks to growth, including potential spillovers from the Israel-Gaza conflict.
The economic situation in Gaza has come to a standstill, with a 6% contraction in output last year.
The IMF does not provide economic projections for the West Bank and Gaza for the next five years due to high uncertainty, and cannot lend to these areas because they are not IMF members.
The European Central Bank's Vice-President, Azour, discussed the bank's role in providing technical assistance to the Palestinian Authority and central bank during the ongoing conflict.
He also mentioned the need for international community support during the reconstruction phase.
Azour further discussed the dire situation in Sudan, where the economy has contracted almost 20 percent due to civil war and instability, causing institutions to collapse.
He emphasized the importance of stopping the bleeding and moving towards reconstruction.
Additionally, Azour mentioned the impact of recent Houthi attacks on Egypt's economy, particularly on Red Sea shipping and the Suez Canal, causing a significant decrease in foreign exchange through trade.
Egypt increased its IMF loan from $3 billion to $8 billion in March 2023, following the central bank's decision to raise interest rates and devalue the pound.
The IMF program emphasizes the privatization of Egypt's state-owned enterprises, many of which are connected to the military.
Egypt aims to expand the private sector and create more jobs by reducing the state's role as a competitor and increasing its role as an enabler.
The economic activity in Gaza has come to a standstill, and the IMF estimates that economic output in the West Bank and Gaza contracted by six percent last year.
The International Monetary Fund (IMF) predicts a 2.7% growth rate for the Middle East and North Africa (MENA) region in 2021, which is 0.2 percentage points lower than its previous forecast.
The IMF warns of heightened risks to growth, including potential spillovers from the Israel-Gaza conflict.
The economic situation in Gaza has come to a standstill, with a 6% contraction in output last year.
The IMF does not provide economic projections for the West Bank and Gaza for the next five years due to high uncertainty, and cannot lend to these areas because they are not IMF members.
The European Central Bank's Vice-President, Azour, discussed the bank's role in providing technical assistance to the Palestinian Authority and central bank during the ongoing conflict.
He also mentioned the need for international community support during the reconstruction phase.
Azour further discussed the dire situation in Sudan, where the economy has contracted almost 20 percent due to civil war and instability, causing institutions to collapse.
He emphasized the importance of stopping the bleeding and moving towards reconstruction.
Additionally, Azour mentioned the impact of recent Houthi attacks on Egypt's economy, particularly on Red Sea shipping and the Suez Canal, causing a significant decrease in foreign exchange through trade.
Egypt increased its IMF loan from $3 billion to $8 billion in March 2023, following the central bank's decision to raise interest rates and devalue the pound.
The IMF program emphasizes the privatization of Egypt's state-owned enterprises, many of which are connected to the military.
Egypt aims to expand the private sector and create more jobs by reducing the state's role as a competitor and increasing its role as an enabler.
Translation:
Translated by AI
