KHALEEJ TIMES, Thursday, Jan 7, 2021 | Jamadi Al Awwal 23, 1442
World Bank tips fragile recovery for Mena in 2021
Emirates:
The World Bank on Tuesday predicted a moderate economic recovery for the
Middle East and North Africa (Mena) region in 2021, while highlighting the
many challenges still posed by the coronavirus pandemic.
The Washington-based institution said that the pandemic had seen the region’s
economies shrink by about 5.0 per cent in 2020, inflicting heavy job losses and
a sharp increase in the number of people living below the poverty line of less
than $5.50 a day.
“Among oil exporters, growth is expected to recover to 1.8 per cent this year,
supported by normalising oil demand, the scheduled easing of the Opec+ oil
production cuts, policy support, and the gradual phasing out of domestic
pandemic-related restrictions,” it said in a report.
Saudi Arabia, the largest economy in the Arab world, will benefit from the
resumption of public projects, which had been postponed at the beginning of the
crisis, and the recovery of demand after a sharp rise in VAT, it said, tipping a
2.0 per cent expansion.
Growth should also accelerate to 1.5 per cent in Iran thanks to the recovery of
domestic consumption and tourism and the mitigation of the effects of Covid-19,
they added. Growth in other countries in the region is expected to reach 3.2 per
cent in 2021 due to the easing of travel restrictions and a slow recovery of
domestic demand.
However, it is expected to reach only 2.7 per cent in Egypt, the most populous
country in the region, following the “collapse” of various sectors, notably
tourism and gas extraction.
The World Bank warned that regional economies faced a variety of hurdles as they
try to get back on their feet.
“The recovery is contingent on containment of the pandemic, stabilising oil
prices, no further escalation of geopolitical tensions, and the assumption of a
vaccine rollout in the second half of the year,” it said.
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