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publication October 9, 2019

MENA Economic Update: Reaching New Heights: Promoting Fair Competition in the Middle East and North Africa

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The Middle East and North Africa (MENA) needs bolder and deeper economic reforms. GDP growth is projected to be 0.6% in the region in 2019, a fraction of what is needed to create enough jobs for the fast-growing working-age population. Even in those few countries that have had periods of higher growth, poverty failed to decline, suggesting a need for reforms to instill fair competition and promote inclusive growth. It is time for MENA countries to focus on both demonopolizing their markets and harnessing the collective domestic demand of their economies to achieve export-led growth regionally and internationally.

Part I discusses the short- and medium-term growth prospects for countries in the Middle East and North Africa. The region is expected to grow at a subdued rate of 0.6% in 2019, rising to 2.6% in 2020 and 2.9% in 2021. The growth forecast for 2019 is revised down by 0.8 percentage points from the April 2019 projection. MENA’s economic outlook is subject to substantial downside risks—most notably, intensified global economic headwinds and rising geopolitical tensions.

Part II of the report argues that promoting fair competition is key for MENA countries to complete the transition from an administered to a market economy. Part II first examines current competition policies in MENA countries and to promote fair competition calls for strengthening competition law and enforcement agencies. It also calls for corporatizing state-owned enterprises, promoting the private sector and creating a level-playing field between them. Any moves to reform MENA economies would be aided by professional management of public assets, which could tap into a new source of national wealth.

 

Algeria | Bahrain | Djibouti | EgyptIraq | Iran | Jordan | Kuwait | Lebanon | Libya | Morocco | Oman | Palestine | Qatar | Saudi Arabia | Tunisia | United Arab Emirates | Yemen |