Economic growth in the Middle East and North Africa will likely hold steady this year, even as the rest of the world economy slows, the International Monetary Fund (IMF) said on Tuesday. But the region’s relative strength is mainly because 2011 was such lousy year.
The economies of the region stretching from Morocco to Iran will expand 3.2% this year, a fractional improvement over 2011’s 3.1%, the Washington-based IMF said in its semi-annual World Economic Outlook. Growth is being supported by oil exporters, who are enjoyed triple-digit petroleum prices, as well as the return of Libya, whose economy came to standstill during last year’s civil war.
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But the outlook for the Middle East and North Africa (MENA) is basically a bear. The world economy is stalling because of European debt woes while locally the turmoil of the Arab Spring continues to weigh on growth for economies like Egypt and Syria. MENA will not only underperform the world’s emerging economies, which are forecast to grow 5.4% this year, but lag behind the world economy as a whole, which will expand 3.3%, according to IMF figures.
Marwan Barakat, chief economist and head of group research at Beirut’s Bank Audi, said the financial outlook for Egypt, Lebanon and Jordan is more dependent on developments in the Arab Spring than on Europe.
“I believe that the evolution of political situation in the region is going to play the most important role deciding whether there are [external financing] needs or not,” Barkat told The Media Line. If the political situation in the region stabilizes “the inflows of capital would be enough to finance all domestic needs of the economy in both private and pubic sector components.”
http://www.themedialine.org/news/news_detail.asp?NewsID=34253 [3]