Economic and Social Inclusion Helps Prevent Violent Extremism and Contribute to Growth in the Middle East and North Africa

October 5, 2016

WASHINGTON, October 5, 2016 –  Against the backdrop of a slowing global economy, the Middle East and North Africa (MENA) region is expected to grow at an average of 2.3 percent this year, half a percentage point lower than last year, according to the latest issue of the World Bank’s MENA Economic Monitor

Low oil prices, which are expected to be in the $50-60 a barrel range through the end of the decade, have dampened growth among the region’s oil exporters, especially the Gulf countries, which are forecast to grow at only 1.6 percent in 2016.  Regional growth is expected to improve slightly to 3.1 and 3.5 percent over the next two years, as governments across the region continue to undertake reforms and diversify their economies away from oil.

Four of the developing oil exporters—Syria, Iraq, Yemen and Libya—are mired in civil war or violent conflict.  MENA’s oil importers, who would normally benefit from low oil prices, are also growing slowly (2.6 percent on average) because of spillovers from wars in neighboring countries or the effects of terrorist attacks on tourism and investor confidence.

“This year appears to be one of the toughest for the region in a while,” says Shanta Devarajan, World Bank Chief Economist of the MENA Region. “Whereas previously we used to speak of two groups of countries in the region, each growing at different speeds, we are now seeing all countries growing at more or less the same, slow pace, albeit for different reasons.”

Recognizing that the rise of violent extremism has contributed to the region’s poor economic performance—not to mention to the death, destruction and human suffering caused by civil wars and conflicts—the report looks at the underlying economic and social determinants of this phenomenon. 

According to the report, policies that promote job creation not only benefit young people seeking jobs, but may also help thwart the spread of violent extremism and its attendant effects on national and regional economic growth.

“Applying an economic perspective, the report finds that the lack of inclusion in many forms is a major driver of radicalization,” says Quy-Toan Do, Lead author of the study and Senior Economist in the World Bank’s Development Research Group.

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