A regular economic bulletin on the Middle East that builds on a range of publications we publish on the global economy and various countries and regions.
Oil cuts extended but austerity eases in places
GCC leads but non-GCC improves
In this edition of Middle East Economy Watch we have stepped back to assess whether the region’s major economies performed to expectations last year and to look forward at the outlook for 2018.
OPEC-led oil production cuts are a dominant theme in both years, however there is plenty else going on. Fiscal reforms are progressing, including the introduction of VAT in various Gulf states. However, there are also new efforts in some countries, notably Saudi Arabia, to ease back on fiscal consolidation to stimulate the private sector.
This is also a good time to take stock of the business environment in the region. (See below)
According to leading benchmarks, countries in the region range from among the best in the world (UAE) to nearly the worst (Libya). There is also substantial flux as some countries implement ambitious reform programmes to attract investment (Saudi Arabia) while others languish.
While such assessments are useful, the rankings still only tell a part of the story, and our discussions with clients often reveal opportunities and challenges in the region that can be obscured by only looking at the big picture.
Finally, our special feature takes a quick look into the complex issue of productivity, an area where we are planning to do more detailed research in 2018. Nobel prize winning economist Paul Krugman has said that productivity determines "almost everything" about an economy in the long run. Many countries in the region are beginning to wake up to the challenges they face in boosting productivity, which lags behind global peers and has been falling in more Middle Eastern countries than it has been improving in.
We wish you all a very productive 2018 and look forward to continuing discussing Middle Eastern economic issues with many of you through out the year.
Source: World Bank Doing Business 2018, World Economic Forum Global Competitiveness Index 2017-18.
Notes: Due to occasional changes in methodology and data, the World Bank no longer compares rankings between years, as we do here.
(out of 190)
(out of 137)