ISTANBUL: The Middle East and North Africa (MENA) region is expected to see its economic growth slow to 1.9% this year, the World Bank said Thursday.
“MENA enjoyed extraordinarily rapid growth in 2022, boosted by the surge in oil prices,” the institution said in its report titled “Balancing Act: Jobs and Wages in the Middle East and North Africa When Crises Hit.”
The region saw an economic growth rate of 6% in 2022, which was driven by oil exporters in MENA, especially the member countries of the Gulf Cooperation Council (GCC), which grew more rapidly than and pulled ahead of oil importers, it noted. In the GCC, economic growth is projected to average just 1% this year, much less than the 7.3% recorded in 2022. However, the deceleration in growth is expected to be less seen among developing oil exporters, which are estimated to grow 2.4% in 2023, down from 4.3% last year.
Developing oil importing countries are anticipated to have an average growth rate of 3.6% this year, also down from 4.9% in 2022. For next year, economic growth in MENA is forecast to accelerate to 3.5%, without a large divergence between oil exporters and oil importers, according to the World Bank. The institution noted that the macroeconomic shocks between 2020-2022 led to an additional 5.1 million people becoming unemployed in the MENA region.
“When economic shocks strike without triggering inflation, it is unemployment that takes center stage as the primary margin of labor market adjustment in MENA,” said the report.
“Following the COVID-19 shock, labor markets adjusted primarily through a reduction in employment and hours worked in MENA countries with low levels of inflation, a pattern that was common around the world,” it added.
Source: Anadolu Agency