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Mid East Info
a day ago
- Business
- Mid East Info
THE IMF AND AUC WRAP UP FIRST MENA ECONOMIC RESEARCH CONFERENCE: STEERING MACROECONOMIC AND STRUCTURAL POLICIES IN A SHIFTING GLOBAL ECONOMIC LANDSCAPE
Following two days of high-level dialogue and expert analysis, the inaugural IMF MENA Economic Annual Research Conference co-organized by the International Monetary Fund (IMF) and the American University in Cairo (AUC), concluded with a strong call for coordinated, evidence-based policy responses to the region's old and new pressing economic challenges. Held on May 18–19, 2025 , the conference served as a critical platform for advancing rigorous research tailored to the realities of the Middle East and North Africa. It brought together global policymakers, academics, government officials and thought leaders to bridge the discussion on global economic issues with regional realities. The event marked a first-of-its-kind collaboration between the IMF and a leading University in the region, reflecting a shared commitment to deepening the link between academic research and policy development. Jihad Azour, director of the IMF's Middle East and Central Asia Department, noted that that trade tensions and increasing uncertainty affecting the global economy, alongside ongoing regional conflicts and climate risks, are creating new layers of complexities for MENA policymakers. Azour called for building a regional platform for dialogue and exchange of ideas that connects MENA to world-class research centers to provide reliable analysis and develop workable and innovative policy responses to old and new economic issues facing the region. 'We are deeply grateful to President Ahmad Dallal and AUC for their commitment to fostering dialogue, research, and policy innovation in the region.' AUC President Ahmad Dallal highlighted the event's role as a vital platform in fostering collaboration between governments, academia and the private sector. 'This is about generating ideas that are globally informed but deeply rooted in the realities of our region,' he noted. Dallal affirmed that this type of multi-stakeholder engagement is at the heart of AUC's mission and reflects the University's commitment to research, education, and open dialogue as drivers of stability, resilience, and inclusive growth. Under the theme 'Steering Macroeconomic and Structural Policies in a Shifting Global Economic Landscape,' discussions centered on four pivotal issues shaping the future of the MENA region and the global economy: Fiscal Policy: With public debt at historic highs, experts stressed the importance of rebuilding fiscal buffers while tackling social inequalities, aging populations, and climate pressures. Proposals included reforms in fiscal frameworks and measures to mobilize revenues, including through multinational taxation and more progressive tax systems. Monetary Policy: Participants reflected on the lessons of recent inflationary shocks, emphasizing the need for more preemptive and well-communicated policy responses to global shocks and sector-specific disruptions, particularly for emerging markets. Industrial Policy: Speakers examined the renewed interest in industrial policy as a tool to drive inclusive growth, innovation, and climate resilience. The discussion highlighted the need to balance vertical strategies with horizontal reforms that promote private investment, trade integration, and productivity. Green Transition and AI: The intersection of climate action and digital transformation sparked debate about their potential to reshape labor markets. Recommendations included investing in human capital, developing targeted safety nets, and aligning policy tools to support job creation in low-emission sectors. Throughout the sessions, there was a clear consensus that the MENA region's economic resilience depends on institutional reforms, cross-border cooperation, and investment in skills and innovation . Participants also underscored the importance of embedding policy in local realities—an approach that both the IMF and AUC pledged to champion moving forward. In addition to prominent global and regional academics, as well as economists and government officials from across the region, and representatives of international and regional organizations, the conference brought together policymakers, including Rania El Mashat, minister of planning, economic development and international cooperation, Egypt; Youssef Boutros-Ghali, member of the Specialized Council for Economic Development, Egypt; Mahmoud Mohieldin, United Nations special envoy on financing the 2030 Sustainable Development Agenda; and Martin Galstyan, governor of the Central Bank of Armenia. As Nigel Clarke, IMF deputy managing director concluded, 'This conference is a milestone demonstrating the IMF's commitment to deepening engagement with the research and academic community, as we strive to ensure that the IMF support is not only responsive to the needs of member countries, but also built on rigorous tested analytics and importantly, it's aligned with local realities. Through this kind of multi-stakeholder dialogue, we aim to better understand how all our expertise and resources can be directed towards the most pressing challenges of the region.'
Asharq Al-Awsat
26-05-2025
- Business
- Asharq Al-Awsat
IMF Forecasts Steady 1% Annual Growth for Gulf Economies Through 2026
Despite a climate of global and regional economic uncertainty, the International Monetary Fund (IMF) expects the Gulf Cooperation Council (GCC) countries to post steady economic growth of around 1% annually in both 2025 and 2026. The projected growth is driven by the Gulf states' ongoing efforts to diversify their economies and reduce reliance on oil revenues. The forecast was shared during an economic panel in Riyadh, where Dr. Jihad Azour, Director of the IMF's Middle East and Central Asia Department, presented the Fund's outlook for the region. While highlighting encouraging signs for oil-exporting countries, especially those in the Gulf, Azour warned that non-oil economies remain exposed to considerable challenges. Azour noted that despite persistent uncertainty, a general economic recovery is anticipated across most countries in the region in 2025. He stressed that the rebound will be more robust among the oil-exporting economies, particularly within the GCC, where the non-oil sector is playing a growing role. 'We expect Gulf economies to grow by about 1% annually in both 2025 and 2026, with non-oil sectors driving that growth,' he said. The Gulf's ability to maintain sustainable growth rates, ranging between 3% and 5% over the past three to four years, has largely been due to their economic diversification programs. The IMF official credited these achievements to a combination of structural reforms and accelerated transformation strategies, which have helped cushion the region from global market volatility and mitigate the impact of oil production cuts under OPEC+ agreements. These positive indicators come despite the IMF having recently revised its 2025 growth forecast for oil-exporting economies in the region downward to 2.3%, a 1.7 percentage point reduction from its previous estimate in October 2024. This revision was largely due to falling energy prices and escalating global trade tensions. Azour downplayed the impact of new tariffs introduced by the US administration under President Donald Trump. He explained that the effect would be limited for most regional countries, as the average tariff increase is expected to be around 10%, and oil and gas exports are exempt. With limited direct trade exposure to the US beyond energy, the broader economic impact should remain minimal. Non-Oil Economies Face Tougher Road Ahead In contrast, Azour painted a more challenging picture for non-oil economies in the region. These countries continue to grapple with geopolitical instability, high interest rates, and weak external demand. Over the past 18 months, multiple shocks have significantly disrupted economies such as Lebanon, Syria, the West Bank, and Gaza, resulting in GDP losses of up to 60%. The effects have spilled over into neighboring nations. Egypt, for instance, has lost an estimated $7 billion in Suez Canal revenues within a single year. Jordan, heavily dependent on tourism and regional stability, has also suffered from declining visitor numbers and job creation. The IMF official warned that several Arab economies, including Lebanon, Jordan, and Morocco, remain highly vulnerable to external shocks due to their reliance on remittances, tourism, and foreign investment. He also pointed out that global financial market volatility has increased risk premiums for the region, causing higher borrowing costs and widening yield spreads compared to other emerging markets. Although some economic improvement is anticipated for non-oil economies compared to 2024, Azour cautioned that overall growth will likely fall short of previous expectations. Countries with high debt levels, particularly oil-importing nations, must closely monitor interest rates. 'Real interest rates have doubled over the past decade, creating an additional burden for countries with large financing needs,' he said. He stressed that 2025 will be a critical year for policy decisions, as global trade tensions, political uncertainty, and rising regional conflicts could undermine business confidence and slow economic recovery. Success, Azour said, will hinge on the ability of governments to accelerate structural reforms, strengthen fiscal and monetary policies, and build financial buffers to withstand future shocks. Saudi Arabia as a Regional Model Saudi Arabia was highlighted as a leading example of economic resilience. Deputy Finance Minister Abdulmohsen Al-Khalaf stated that the Kingdom's comprehensive reform agenda has enhanced its ability to weather global turbulence without compromising development goals. He pointed to the implementation of strong fiscal frameworks and structural reforms as key enablers of Saudi Arabia's flexibility in navigating economic disruptions. Al-Khalaf stressed that fiscal policy must remain central to the regional response to global fragmentation and commodity price swings. He underscored the importance of maintaining fiscal prudence, accelerating reforms, investing in strategic sectors, and supporting private sector growth to ensure long-term stability and sustainability across the region.
Asharq Al-Awsat
26-05-2025
- Business
- Asharq Al-Awsat
Azour: Saudi Arabia Adapts to Global Challenges Thanks to Reforms, Strong Reserves
Saudi Arabia continues to demonstrate resilience in the face of global economic challenges, bolstered by structural reforms and substantial financial reserves, According to Dr. Jihad Azour, Director of the Middle East and Central Asia Department at the International Monetary Fund (IMF). He said the Kingdom is well-equipped to manage fluctuations in global oil prices. Speaking to Asharq Al-Awsat on the sidelines of an IMF-hosted panel in Riyadh on global and regional economic developments, Azour stressed that Saudi Arabia has significant reserves that act as a financial buffer against external shocks. These reserves, coupled with ongoing structural reforms under Saudi Vision 2030, have greatly enhanced the Kingdom's economic adaptability. Azour noted that the reforms are not only increasing the economy's flexibility but are also successfully diversifying income sources and boosting the contribution of non-oil sectors to the GDP. This shift toward developing promising new sectors is reducing dependency on oil revenues while creating sustainable economic opportunities. He stressed that the mechanisms in place in the Kingdom, the adopted fiscal policies, and the implementation of Vision 2030 allow it to adapt to global shifts, despite current challenges. Earlier this month, Saudi Minister of Economy and Planning Faisal Alibrahim confirmed the Kingdom's readiness to face all possible oil price scenarios, noting that Saudi Arabia has sufficient safety margins. A mission to Syria In a notable development, the IMF is sending a mission to Syria this week to assess the country's financial and economic landscape in the first such visit in over a decade. Azour confirmed the visit will focus on evaluating the central bank, finance ministry, and statistical agencies to determine technical needs and explore cooperation frameworks. The mission aims to establish priorities for providing technical assistance and institutional support, and reflects the IMF's renewed engagement with Syria. Azour himself plans to visit Damascus at the end of June following the mission's report. The move comes after the IMF appointed Ron van Rooden as its mission chief to Syria in April 2025, the first such appointment since the Syrian conflict began. Azour said initial discussions with Syrian officials began at the Emerging Markets Forum in AlUla, Saudi Arabia, earlier this year and continued during the IMF-World Bank Spring Meetings in Washington. The talks were attended by Syria's Foreign Minister Asaad Al-Shaibani, and were supported by Saudi Finance Minister Mohammed Al-Jadaan, IMF Managing Director Kristalina Georgieva, and World Bank President Ajay Banga. International Support and Lifting of Sanctions The IMF's renewed involvement coincides with growing international efforts to reintegrate Syria into the global economic system. In a significant step, the US Treasury Department officially lifted economic sanctions on Syria last Friday. US Treasury Secretary Scott Bessent said Syria must continue working to become a peaceful and stable country, and expressed hope that the latest decision would help put the country on a path toward prosperity and peace. US Secretary of State Marco Rubio also announced a 180-day waiver of Caesar Act sanctions to facilitate investment and ensure uninterrupted access to electricity, energy, water, healthcare, and humanitarian aid. In a further sign of support, Saudi Arabia and Qatar pledged to repay Syria's debt to the World Bank, paving the way for the resumption of its operations in the country after a 14-year hiatus. This move could unlock international funding crucial for Syria's reconstruction and economic recovery. The IMF's engagement is part of a broader strategy to support conflict-affected countries in rebuilding institutions, restoring economic stability, and fostering inclusive development. Through this renewed cooperation, the IMF hopes to help lay the groundwork for sustainable growth and improved livelihoods for the Syrian people.
The National
25-05-2025
- Business
- The National
Arab war-torn countries severely hit by US tariffs, says IMF
Washington's tariffs regime has had detrimental effects on world economies but the repercussions for Middle East countries struggling with conflicts are even worse, according to the regional director of the International Monetary Fund. For some countries in the Middle East and North Africa region, the impact of US levies compounded the shocks that have been jolting them for more than a year and a half, said Jihad Azour, who heads the IMF's Middle East and Central Asia Department. 'Especially where those [conflicts] were happening … Lebanon, Syria, the West Bank and Gaza,' said Mr Azour during a Sunday summit at the IMF's regional office in Riyadh. The impact of US tariffs that suddenly went from 5 per cent to about 30 per cent for many countries was telling. Those economies suffered, 'with losses of output that could exceed 50 or 60 per cent of GDP', he said, adding that the impact was even more severe for countries, whose economies were reliant on regional tourism as their supply chains were heavily affected. 'Egypt suffered because of uncertainty on the trade routes, $7 billion [that] they used to collect by the Suez Canal disappeared over less than one year,' he said in his opening address, identifying Jordan as another hard-hit country. Despite these pressures, Mr Azour said recent developments such as increased regional co-operation, private investment and the push for the development of AI could help these economies in crisis to grow out of their current fragile state. In February, the IMF announced the creation of its informal coalition with Arab nations and the World Bank to support the recovery of the region's countries devastated by war – the Arab Co-ordination Group. Today, the fund and its partners are focusing on areas of trade disruption, infrastructure investment, and using AI to accelerate private sector growth and regional co-operation to aid economies in crisis. 'The hope is that some of the conflicts could turn into a post conflict situation, and reconstruction and recovery will emerge' Mr Azour said. Gulf countries, of which many have gone through a transformation in the past eight to 10 years, are in a better position to take action to support the struggling economies in the region, he said. 'Doubling down to deepen those reforms and create a regional block that would become larger as a market and more effective as a convening group,' Mr Azour added. While some of the Middle East countries have faced the pressures of trade war market volatility and geopolitical upheaval, all these factors have affected nations around the world to varying degrees. The impact of the economic uncertainty on the global financial sector is multifaceted and deep, according to Jamal Al Kishi, chief executive of Deutsche Bank Middle East and North Africa. 'There is a general decline in sentiment in the [global] economy that definitely lowers growth', said Mr Al Kishi, during a panel titled Global and Regional Economic Developments and outlook. Investments are typically halted, consumption at times is curtailed in addition to the demand for loans, products and other financial services declining, he said. 'Banks typically witness decline in the quality of their loans when there's lower growth and higher uncertainty. Some households, some corporate clients, run into difficulty that begins to create non-performing loans, that causes banks to incur losses and higher provisions, and those are, of course, quite impactful,' he added. The culmination of all these issues usually lead to high interest rates from central banks and inflation, which are inimical to growth. These global factors are increasing the load on economies already under the pressures of geopolitical conflict, and regional co-operation could be a way back to growth, Mr Al Kishi said. Abdulmuhsen AlKhalaf, Vice Minister of Finance of Saudi Arabia, said the path to stability given the global economic headwinds and geopolitical uncertainty is 'through structural reforms that regional countries need to take to support their economies during these difficult situations'. Using the example of the kingdom, he said Saudi Arabia was able achieve 52 per cent of its economic output from non-oil activities to achieve its Vision 2030 goals. 'This give us … enhanced our resilience, and now we are facing this external shock from a position of strength,' he added. The region's recent push for AI is also having an effect, according to Bandr Al Homaly, chief executive of Jada Fund of Funds, an investment management company backed by Saudi Arabia's sovereign wealth fund. 'Technology overall can accelerate economic development with the democratisation of technology. The potential is huge, interconnected, and inclusive and private markets [that] will increase deal flow,' he said. This was made possible with low barriers to entry, more accessibility to data, and the decentralisation of innovation hubs, said Mr Al Homaly. 'Innovation now can occur in unexpected places in the world not necessarily in Silicon Valley or other traditions hubs,' he said.
The National
25-05-2025
- Business
- The National
Arab countries at war hit hardest by US tariffs, says IMF
Washington's tariffs regime has had detrimental effects on world economies but the repercussions for Middle East countries struggling with conflicts are even worse, according to the regional director of the International Monetary Fund. For some countries in the Middle East and North Africa region, the impact of US levies compounded the shocks that have been jolting them for more than a year and a half, said Jihad Azour, who heads the IMF's Middle East and Central Asia Department. 'Especially where those [conflicts] were happening … Lebanon, Syria, the West Bank and Gaza,' said Mr Azour during a Sunday summit at the IMF's regional office in Riyadh. The impact of US tariffs that suddenly went from 5 per cent to about 30 per cent for many countries was telling. Those economies suffered, 'with losses of output that could exceed 50 or 60 per cent of GDP', he said, adding that the impact was even more severe for countries, whose economies were reliant on regional tourism as their supply chains were heavily affected. 'Egypt suffered because of uncertainty on the trade routes, $7 billion [that] they used to collect by the Suez Canal disappeared over less than one year,' he said in his opening address, identifying Jordan as another hard-hit country. Despite these pressures, Mr Azour said recent developments such as increased regional co-operation, private investment and the push for the development of AI could help these economies in crisis to grow out of their current fragile state. In February, the IMF announced the creation of its informal coalition with Arab nations and the World Bank to support the recovery of the region's countries devastated by war – the Arab Co-ordination Group. Today, the fund and its partners are focusing on areas of trade disruption, infrastructure investment, and using AI to accelerate private sector growth and regional co-operation to aid economies in crisis. 'The hope is that some of the conflicts could turn into a post conflict situation, and reconstruction and recovery will emerge' Mr Azour said. Gulf countries, of which many have gone through a transformation in the past eight to 10 years, are in a better position to take action to support the struggling economies in the region, he said. 'Doubling down to deepen those reforms and create a regional block that would become larger as a market and more effective as a convening group,' Mr Azour added. While some of the Middle East countries have faced the pressures of trade war market volatility and geopolitical upheaval, all these factors have affected nations around the world to varying degrees. The impact of the economic uncertainty on the global financial sector is multifaceted and deep, according to Jamal Al Kishi, chief executive of Deutsche Bank Middle East and North Africa. 'There is a general decline in sentiment in the [global] economy that definitely lowers growth', said Mr Al Kishi, during a panel titled Global and Regional Economic Developments and outlook. Investments are typically halted, consumption at times is curtailed in addition to the demand for loans, products and other financial services declining, he said. 'Banks typically witness decline in the quality of their loans when there's lower growth and higher uncertainty. Some households, some corporate clients, run into difficulty that begins to create non-performing loans, that causes banks to incur losses and higher provisions, and those are, of course, quite impactful,' he added. The culmination of all these issues usually lead to high interest rates from central banks and inflation, which are inimical to growth. These global factors are increasing the load on economies already under the pressures of geopolitical conflict, and regional co-operation could be a way back to growth, Mr Al Kishi said. Abdulmuhsen AlKhalaf, Vice Minister of Finance of Saudi Arabia, said the path to stability given the global economic headwinds and geopolitical uncertainty is 'through structural reforms that regional countries need to take to support their economies during these difficult situations'. Using the example of the kingdom, he said Saudi Arabia was able achieve 52 per cent of its economic output from non-oil activities to achieve its Vision 2030 goals. 'This give us … enhanced our resilience, and now we are facing this external shock from a position of strength,' he added. The region's recent push for AI is also having an effect, according to Bandr Al Homaly, chief executive of Jada Fund of Funds, an investment management company backed by Saudi Arabia's sovereign wealth fund. 'Technology overall can accelerate economic development with the democratisation of technology. The potential is huge, interconnected, and inclusive and private markets [that] will increase deal flow,' he said. This was made possible with low barriers to entry, more accessibility to data, and the decentralisation of innovation hubs, said Mr Al Homaly. 'Innovation now can occur in unexpected places in the world not necessarily in Silicon Valley or other traditions hubs,' he said.
