European stocks set for cautious open ahead of crucial EU summit    Egypt's Foreign Minister holds talks with Lithuania's gov't chancellor    No final Brexit deal on Wednesday: BBC political editor    British Council announces its first 'Science Stars' competition in Egypt    Egypt in talks with World Bank over solid waste management loan    Kenya opens $1.5 bln Chinese-built railway linking Rift Valley town and Nairobi    US seeks Turkish ceasefire from meeting with Erdogan: Pompeo    Grand Nile Tower Arts & Cultural Centre launches second round    AUC students win prestigious award at SensUs 2019    UEFA punishes Lazio for fans' racism at Europa League game    Bulgaria detains 4 soccer fans following racist acts in England match    Egypt's coach Hossam El-Badry satisfied with winning start despite technical problems    Lebanon deploys water cannon, helicopters to fight wildfires across country    MPs vent their anger at government    Hundreds released    Bulgaria boss Balakov apologizes to England over racist chants during Euro 2020 qualifier    Debating local councils law    Petrochemicals hurt Qatar, Gulf stocks mostly quiet early on    Macron on course for clash with Merkel over starting membership talks    Making healthcare universal    Scientists find how deadly malaria parasite jumped from gorillas to humans    Sliding inflation    Luxor's new discoveries    IMF's head Georgieva hails Egypt's economic reforms    Egypt's PM, US secretary of energy mull cooperation in energy, electricity    Moroccan film Nomades scoops awards in Alexandria Film Festival    British police order a halt to climate change protests in London    U.S. demands Syria ceasefire, imposes sanctions on Turkey over incursion    Toshiba's JV with Egyptian Elaraby opens regional HQ in South Africa    Six authors vie for Booker prize 2019, Atwood in the lead    In Photos: A sneak peek into rehearsals for the Cleopatra ballet world premiere    Sisi, Ethiopia's PM to meet in Moscow to discuss GERD issue    Sisi: army engaged in attrition phase against terrorism in Sinai since 2013    10K fans to attend Egypt's friendly against Botswana in Alexandria: EFA    Sisi, Ethiopia's PM agree to overcome obstacles in Nile dam talks    Farwell to Egyptian comic actor Talaat Zakaria    Court sentences six to death, 41 to lifetime imprisonment violence related case    Trump says he would release Mideast peace plan after Israeli elections    ACWA Power compares 3 bids to supply production units for Luxor power station    What do you know about gold alloying?    NBE announces EGP 2.5m prizes for handball youth teams for their world achievements    Jennifer Lopez evokes Egyptian outrage post her North Coast performance    Al-Sisi honours Egypt's scholars on Science Day    IS claims responsibility for suicide bombing killing 63 in Afghan wedding    Political parties gear up for parliamentary, senate, local elections    Unprecedented Glory: Egypt win Men's U-19 World Handball Championship    12th National Egyptian Theatre Festival fuel up public theatre art scene    Ministry of Environment has a plan for "black clouds season"    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.





IMF: Arab Spring economies to recover slowly in 2013
Published in Almasry Alyoum on 11 - 11 - 2012

Most economies hit by the Arab Spring uprisings will recover only slowly next year as they grapple with high inflation and rising unemployment due to poor global conditions, the International Monetary Fund predicted in a report on Sunday.
In its twice-yearly outlook for the Middle East and North Africa, the global lender said a partial return of political stability could permit somewhat faster growth in Egypt, Jordan, Morocco, Tunisia and Yemen during 2013.
But weak demand in Europe and other regions will weigh on the Arab Spring states, it said. In many of those countries, exports are shrinking and have not yet bottomed out, it added.
"Growth is expected to remain below long-term trends, and unemployment is expected to increase owing to continued anemic external demand, high food and fuel commodity prices, regional tensions and policy uncertainty."
Masood Ahmed, director of the IMF's Middle East and Central Asia Department, conceded his organization and other forecasters had initially underestimated the difficulties Arab Spring economies faced. While they were previously expected to start recovering strongly this year, that has not happened, he said.
"Contraction has stopped, but we still have growth rates that are barely keeping up with population growth, and certainly well below what is needed to cut unemployment," he told a news conference.
The IMF forecast total gross domestic product in the five countries would expand by 3.6 percent next year, accelerating from an estimated 2.0 percent this year and 1.2 percent in 2011. In 2010, the year before the uprisings, GDP grew 4.7 percent.
Because of sluggish global demand, the group's current account balance of trade in goods and services will improve only marginally next year, to a deficit of 4.6 percent of GDP from this year's 5.4 percent deficit, the IMF predicted.
It suggested some countries should consider allowing greater flexibility in their exchange rates — code for permitting their currencies to depreciate — in order to stimulate exports.
Analysts believe the IMF may be urging Egypt to let its pound depreciate in talks now underway on a US$4.8 billion IMF loan to Cairo. But Ahmed did not specify which countries the IMF felt should consider depreciation.
Weaker currencies could fuel inflation, which the IMF forecast would rise to 8.6 percent for the group next year, the highest level since 2008, from 7.8 percent this year.
Inflation is expected to rise in Egypt and Morocco as they try to curb their large budget deficits by scaling back food and fuel subsidies, the IMF said. Political turmoil has prompted Arab Spring states to try to buy social peace by boosting spending on welfare steps such as subsidies.
The IMF predicted the five countries' combined budget deficit would shrink only slightly next year, to 8.0 percent of GDP from 9.1 percent. Ahmed said he was concerned countries were still not making difficult decisions to cut their deficits.
"Some countries are financing current spending, much of it in subsidies, by cutting back on investment, mortgaging the future of the economy," he said.
Libya
Libya, which ousted its dictator Muammar Qadhafi last year, is a spectacular exception to the pattern of slow recovery among Arab Spring because of its oil wealth. Oil output is returning to its pre-civil war level faster than expected, the IMF said.
The country's GDP shrank 60 percent last year but is expected to rise 122 percent this year, 17 percent in 2013 and 7 percent annually on average between 2014 and 2017, assuming the domestic security situation improves, the IMF predicted.
It forecast Libya would run a huge state budget surplus of 19 percent of GDP in 2012, and a current account surplus of 22 percent.
Inflation shot up to 16 percent last year because of the civil war's damage to factories and transport systems, but it is likely to fall to 10 percent this year as business becomes more normal and drop to just 1 percent in 2013, the IMF said.


Clic here to read the story from its source.