THE MENA REGION THE ECONOMIC IMPACT OF CONFLICTS

Transcription

1 I N T E R N AT I O N A L M O N E TA R Y F U N D Middle East and Central Asia Department THE MENA REGION THE ECONOMIC IMPACT OF CONFLICTS November 29, 216

2 The MENA region is exposed to violent conflicts January 211 Source: IMF Security Services. Note: Country borders do not necessarily reflect the IMF's official position. November 29, 216 2

3 The MENA region is exposed to violent conflicts September 216 Source: IMF Security Services. Note: Country borders do not necessarily reflect the IMF's official position. November 29, 216 3

4 Main economic transmission channels Greatest Effect Damage to physical capital and infrastructure Deaths, internal displacement and refugees Weakening confidence and security Weakening social cohesion and institutional quality In conflict Neighbors Little Effect Rest of the World Note: Human capital includes loss of life, refugees, IDPs. November 29, 216 4

5 In thousands Conflicts have major economic impacts Economic Growth in Conflict Countries (Percent change) Sources: National authorities; and IMF staff calculations Iraq Libya Yemen November 29, 216 5

6 Macroeconomic policy response: overview Limit the immediate impact of conflicts Longer-term agenda Stabilize Inclusive growth reforms Address longer-term needs of refugees Prioritize Protect Post-conflict rebuilding November 29, 216 6

7 An agenda to support inclusive growth Fiscal Policy Labor Markets Access to Finance Business Climate Governance Subsidy reform Efficiency of public investment PFM; Civil service reform Tax reform; Strengthened social protection Female and youth employment Public/private sector employment/informality Skills mismatches Education reforms Access to finance for SMEs Financial inclusion Banking supervision Bank restructuring Simplifying regulations Trade openness Economic diversification Fiscal and budgetary transparency Business and investment codes Public enterprise reform Enforcement/level-playing field November 29, 216 7

8 For oil importers, macroeconomic stabilization has advanced Budget Deficits (Percent of GDP) Changes in Government Revenues and Spending (Percent of GDP, Change from Prior Year) ,,5 8, 6 4 -,5 2 EGY JOR LBN MAR TUN -1, Capital Subsidies Other current Wages Interest Revenue Sources: National authorities, and IMF staff calculations Note: Excluding NEPCO losses in Jordan. Sources: National authorities, and IMF staff calculations. Note: Includes Egypt, Jordan, Morocco, Pakistan, and Tunisia.. November 29, 216 8

9 but growth remains too low to reduce high unemployment Real GDP Growth Still Below Historical Average (Weighted average, annual percent change) Unemployment Rates (In percent) growth rate average MAR EGY Weighted Average 8 2 JOR LBN TUN Egypt Jordan Morocco Tunisia EMs Sources: National authorities; and IMF staff estimates. Sources: National authorities, ILO; and IMF staff calculations. November 29, 216 9

10 Private sector employment is low in most countries Employment as a Share of Population (In percent) Employment by Sector, (In percent of total labor force, latest available) Public Informal private Formal private Self employed & unpaid Egypt Jordan Morocco Tunisia EMs Jordan Egypt Tunisia Yemen Morocco Sources: ILO estimates, and IMF staff calculations. Source: World Bank. November 29, 216 1

11 Youth and women are excluded Youth Unemployment Rate (Percent) OI OE Em East MENA EUR EDE AE LAC EDA Asia SSA Male and Female Labor Force Participation (Percent of working age population) Men Gap 56% Women 51% 3% OE OI Em MENA Asia 27% Em EUR 26% 14% 11% LAC AE SSA Sources: ILO estimates; and IMF staff calculations. Note: OI = oil importers; OE = oil exporters; Em EUR = emerging and developing Europe; AE = advanced economies; LAC = Latin America and the Caribbean; SSA = sub-saharan Africa. November 29,