Despite low GDP in 2024, accelerating reforms could promote inclusive growth
WASHINGTON, USA October 18, 2024-/African Media Agency (AMA)/– Growth remains sluggish in the Middle East and North Africa (MENA) region, due to uncertainties exacerbated by regional conflict, says the World Bank in its latest Semi-annual report on the economic situation in the MENA regiontitled ” Growth in the Middle East and North Africa » (a).
The report forecasts modest growth in the region’s gross domestic product (GDP), with an increase in real terms forecast at 2.2% in 2024, compared to 1.8% in 2023. This slight increase is mainly due to Council countries of Gulf Cooperation (GCC), where growth is expected to increase from 0.5% in 2023 to 1.9% in 2024. In contrast, in the rest of the MENA region, a slowdown is expected. Growth in oil-importing countries is expected to fall from 3.2% in 2023 to 2.1% in 2024, while that of non-GCC oil-exporting countries is expected to decline from 3.2% to 2.7%.
The report uses an innovative measure – forecast deviation among private sector forecasters – to assess uncertainty levels. By this measure, economic uncertainty in the MENA region is currently twice the average for other emerging markets and developing economies around the world.
The ongoing conflict in the Middle East has already taken a heavy human and economic toll. The Palestinian Territories are on the brink of collapse, experiencing the largest economic contraction on record. Gaza’s economy contracted by 86% in the first half of 2024, while the West Bank faces an unprecedented fiscal and private sector crisis. In Lebanon, also affected by the conflict, the outlook remains extremely uncertain, depending on the evolution of the conflict. Furthermore, neighboring countries such as Jordan and Egypt are feeling the impact of a drop in tourism and tax revenues.
Conflicts have a lasting impact on the development trajectories of countries. According to the report, the GDP per capita of MENA countries affected by conflict could have been on average 45% higher, seven years after the start of the conflict. This loss is equivalent to the average progress made by the region over the past 35 years.
« Peace and stability are essential pillars of sustainable developmentsaid Ousmane Dione, World Bank Vice President for the Middle East and North Africa. The World Bank Group is committed to maintaining its interventions in the conflict-affected regions of the Middle East and North Africa, with the aim of building a future that meets the aspirations of all people in the region. region. »
The report also highlights key opportunities for countries to rapidly accelerate inclusive growth by scaling up reforms. These priorities include the need to rebalance the role of the public and private sectors, better distribute talent in the labor market, reduce gender gaps and promote innovation.
Despite a marked improvement in education levels over the past 50 years, female labor force participation rates in the Middle East and North Africa remain the lowest in the world, at just 19%. Closing the gender employment gap could lead to a significant 51% increase in per capita income in an average MENA country. For economies to thrive, women must be included, the report says.
« A transformation of the role of the State would lead to substantial productivity gainssaid Roberta Gatti, World Bank chief economist for the Middle East and North Africa. For example, the region has the highest proportion of public sector employees in the world, particularly among women. Unfortunately, in the MENA region, a larger public sector does not necessarily translate into improved public goods and services. Mobilization of talent to the private sector would allow resources to be better allocated, with overall productivity gains of up to 45%.. »
The MENA region can also boost its growth by leveraging global advances in knowledge and technology. The intensification of international exchanges, supported by the strategic geographical position of the region, can accelerate this process of innovation and knowledge transfer. Another key lever lies in improving the quality and transparency of data, currently lagging behind international standards, to facilitate the dissemination of ideas.
Access the report [ici].
Distributed by African Media Agency (AMA) for the World Bank.
Source : African Media Agency (AMA)
2024-10-18 10:49:00
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