The World Bank responded to strong demand from countries in MENA for development finance, global expertise and innovation during the financial year that ended on June 30th, 2018. In addition to US$6.3 billion in new financial commitments during the past financial year, the Bank also delivered a wide range of analytical products to help MENA countries transform their economies and lay the foundations for inclusive growth and job creation.
The record commitment included US$5.9 billion from the International Bank for Reconstruction and Development, which supports development in middle-income countries, and US$430 million from the International Development Association, the Bank’s fund for the world’s poorest countries. The World Bank’s knowledge services included support for the region’s high-income countries, through its Reimbursable Advisory Services. The program, which reached US$55 million during the past financial year, supported efforts to diversify economies and promote private sector development, while supporting human development through the reform of key public services such as education, health and social protection.
The Maximizing Finance for Development approach, to leverage private sector financing sustainably in support of development, is now an integral part of Bank Group programs in almost all countries in the region, with sub-regional strategies developed for the Maghreb, the Mashreq, and Egypt.
The MENA regional strategy puts the promotion of peace and social stability at its center and continues to guide the Bank’s engagement. The strategy’s four pillars focus on forging a new social contract with citizens; increasing regional cooperation; building resilience, which includes addressing the challenges of forcibly displaced people; and supporting recovery and reconstruction. Many Bank programs in the region include more than one of these pillars.
Renewing the social contract
Promoting more accountable and more inclusive structures and supporting private sector–driven economies to provide greater opportunities remain key regional priorities for the Bank. In Tunisia, for example, a $60 million loan targeted youth facing unemployment, another $100 million loan focused on early childhood development, and a separate $140 million program supported farmers. In Lebanon, a $400 million program promoted labor-market reforms and skills training, including for refugees. A $30 million grant to the West Bank and Gaza supported fiscal measures while strengthening the business environment, and a separate $13 million Innovative Private Sector Development Project further strengthened the role of technology in helping to develop the private sector. In Djibouti, a $13 million project sought to foster women and youth entrepreneurship and further highlighted the region’s private sector focus, while in Egypt, a $500 million project supported critical reforms in the education sector.
Increasing regional cooperation
The Middle East and North Africa is the least integrated region in the world. The Bank’s activities in the region therefore focus on promoting greater cooperation, efficiency, and interdependence, particularly in the energy and private sectors, where reforms will enhance cross-border investments and reinforce moves toward a regional market. In fiscal 2018, a $1.1 billion loan to Egypt enhanced fiscal stabilization and private sector reforms in the energy sector while further reducing subsidies. In Morocco, a $200 million loan enhanced private sector participation in municipal infrastructure, while another $200 million program supported private sector activities in agriculture. To promote the expansion of renewable energy capacity in the country, the Bank also provided $100 million in additional financing for the Noor Solar Power Project in central Morocco, which promotes private sector participation.
Building resilience to forced displacement
In countries throughout the region, especially in Jordan, Lebanon, and Iraq, the forcibly displaced—including refugees and internally displaced persons—continue to pose challenges for local services. In Jordan, a $148 million program for education reform will benefit both host communities and refugees in the country. Meanwhile, in
Lebanon, Syrian refugees are among the beneficiaries of a $225 million loan that will improve public transportation in Beirut and the surrounding areas. These projects all include concessional financing from the Global Concessional Financing Facility, an initiative launched in 2016 that leverages funding from donor countries to bridge the financing gap for countries dealing with refugee crises.
Supporting economic recovery and reconstruction
Following the liberation of Iraq from ISIS, the World Bank has focused on recovery and reconstruction in the country. This effort includes the $300 million Iraq Social Fund for Development program focused on small-scale community projects, the $200 million Iraq Emergency Social Stabilization and Resilience Project focused on social protection for vulnerable populations, and $400 million in additional financing for the Emergency Operation for Development Project to rehabilitate infrastructure. Meanwhile, the $210 million Baghdad Water Supply and Sewerage Improvement Project underlines the Bank’s commitment to longer-term reforms in Iraq’s water sector, including creating the enabling environment for private sector investments. Elsewhere in the region, the Bank has expanded support to vulnerable communities affected by conflict, most notably in the Republic of Yemen, where a humanitarian crisis looms. In fiscal 2018, the Republic of Yemen received three grants totaling $400 million for health and nutrition, specifically targeting the cholera outbreak, urban services, and emergency electricity provision. An additional $36 million grant will help smallholder farmers.
RECENT ANALYTICAL WORK
A number of analytical studies have been published recently by the Bank addressing key challenges as the region struggles with major political and economic transitions.
The World Bank’s latest Middle East and North Africa Economic Monitor focuses on how the region could accelerate growth and create the number and quality of jobs needed by seizing the opportunities that the digital economy offers and leveraging the potential of its large, well-educated and tech-savvy youth population.
Water Management in Fragile Systems: Building Resilience to Shocks and Protracted Crises in the Middle East and North Africa
Focuses on the critical role that effective management of the region’s scarce water resources plays in promoting growth, building up resilience and contributing to future stability.
Shedding Light on Electricity Utilities in the Middle East and North Africa finds that improvements in the efficiency of electricity utilities could cover the average investment urgently needed in the region’s electricity sector, estimated at 3 percent of GDP.
The Toll of War: The Economic and Social Consequences of the Conflict in Syria which examines the impact of the conflict as of early 2017, and finds the biggest loss is from the disruption of economic activity. Enhancing job opportunities for skilled women in the Palestinian territories highlights the constrains to labor market entry in the face of Palestinian women, and provides recommendations going forward.
lastupdated: Apr 20, 2018