A senior official at the International Monetary Fund said, on Saturday, that the possibilities for banks in the Middle East and Central Asia to be exposed to the banking turmoil that the United States and Europe witnessed last month are very limited, but financial pressures exacerbate the pressures resulting from high interest rates, volatile oil prices and the persistence of double-digit inflation rates. years ago.
Jihad Azour, Director of the Middle East and Central Asia Department at the International Monetary Fund, said that the pressures of the banking sector came quickly following tighter monetary policies that raised interest rates and reduced access to financing.
Azour added that there is a growing gap between countries that have good credit and are able to access markets, including Morocco and Jordan, oil exporters and others, and countries that face problems.
And he added, “We are concerned because the risks are constantly increasing: high interest rates, volatile oil prices, geopolitical tension, and this is the third year in a row that inflation continues to be in double digits.”
He said that the stability of the financial sector is not the main concern as it is preceded at the present time by concerns regarding high debt levels, the risk of social unrest and the ability to maintain strict policies due to pressures on social conditions.
“We see increasing vulnerabilities once more, and that’s why countries are encouraged to do more structural reforms, to increase their growth by at least one or two percent… They have a window of opportunity now that governments are willing to do more, not put The money is in the coffers of central banks.
On Thursday, the International Monetary Fund predicted a slowdown in gross domestic product growth in the Middle East and North Africa region to 3.1 percent in 2023 from 5.3 percent a year earlier.