IMF says growth in Mideast, North Africa to slow

The International fund cut its 2011 growth forecast for the Middle East and North Africa to 4 per cent on the back of political unrest and the European debt crisis

Instability in the Middle East and North Africa, along with high unemployment and rising food prices, will hinder the region's growth, the International Monetary Fund (IMF) said on Tuesday.
"The region faces serious policy challenges," the fund said in its most recent world economic outlook. "Beyond securing economic and social stability, shorter term challenges focus on the need to place public finances on a sustainable footing," the report said.
The IMF zeroed in on oil exporters such as Qatar, Iraq and Saudi Arabia, and said their governments needed to capitalise on high oil prices and move toward sustainable and more diversified economies.
Mass social unrest in countries such as Egypt has impeded tourism and private financing throughout the Middle East and North Africa, the fund said.
Adding to the region's troubles, the IMF said the European debt crisis and weaker growth prospects in the United States could further depress activity, commodity prices and foreign investment.
"Any intensification of the political crises would exacerbate the economic plight of the region," the IMF warned, saying Middle Eastern and North African oil production could be further affected with "ramifications for global energy markets."
The IMF cut its 2011 growth forecast for the Middle East and North Africa to 4 per cent from 4.2 per cent in June. The fund's growth expectations for the following year were also cut to 3.6 per cent from the previous 4.4 per cent forecast.
This year's growth among North African and Middle Eastern oil exporters, including Saudi Arabia, Iraq and Qatar, was seen at 4.9 per cent. Qatar's 2011 gross domestic product is seen expanding 18.7 per cent due to expansion in natural gas exports.
In contrast, the fund forecast growth for oil importers at 1.4 per cent.