INTERNATIONAl. Middle East and North Africa economic growth will accelerate from an estimated 2.9% in 2009 after the global credit crisis sent oil prices tumbling, the World Bank said in its latest report published today.
According to the Global Economic Prospects 2010, the regional economy will grow 3.7% this year and 4.4% in 2011. Growth was 4.3% in 2008, the bank said.
“Stronger global activity should allow for crude oil and gas production to return to positive growth, implying moderate revenue gains,” the World Bank said.
Following a peak in July 2008 of about US$147 a barrel and a low of US$34 in December of the same year, oil prices have settled into a range of US$65- US$$80 a barrel following output cuts by the Organization of Petroleum Exporting Countries, the report said.
Gross domestic product in Saudi Arabia, Kuwait, Oman and Bahrain, members of the Gulf Cooperation Council, contracted about 0.6% in 2009, compared with growth of 4.6% the year before, the report said. Growth in the four countries may reach 3.2% this year and 4.1% in 2011, it said.
Growth in developing oil exporters -- Iran, Syria, Algeria and Yemen -- is expected to reach 3.1 percent this year and 3.7 percent in 2011, the bank said.
Egypt's economy may grow 5.2% this year and 6% in 2011, the report said, from an estimated rate of 4.7% in 2009. The Lebanese economy is expected to maintain a growth rate of 7% through 2011, it added.
There remain “substantial downside risks, which would pose additional challenges to policy makers already grappling with the current crisis” in the region, the report said.
The risks include political tensions and the possibility of a deeper global recession, the report said. The debt crisis of Dubai World, one of the emirate’s three main state-owned business groups, indicates that “financial institutions in the region were not entirely unaffected by the global financial crisis,” the World Bank said.
The Global Economic Prospects 2010 expects the global economy to grow 2.7% this year and 3.2% in 2011 after contracting 2.2% in 2009.
"A great deal of uncertainty clouds the outlook for the second half of 2010 and beyond," the report said.
Though the "acute phase" of the crisis had passed, chronic weaknesses remained, it said. Much depended on the timing of withdrawal from massive stimulus programmes and adjustments to monetary policy, it added.
Mishandling could result in a "double-dip", with a return to recession in 2011, it warned.