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IMF / MIDDLE EAST
STORY: IMF / MIDDLE EAST
TRT: 2:01
SOURCE: IMF
RESTRICTIONS: NONE
LANGUAGES: ENGLISH / NATS
DATELINE: APRIL 2011, WASHINGTON DC / RECENT
RECENT – WASHINGTON DC
1. Wide shot, exterior IMF building
APRIL 2011, WASHINGTON DC
2. SOUNDBITE (English) Masood Ahmed, Director, Middle East and Central Asia Department, International Monetary Fund:
“As a group, these countries are going to grow about 2 percent this year, which is considerably lower than last year. As a group, their budget deficits are going to increase to over $40 billion this year.”
RECENT – CAIRO, EGYPT
3. Various shots, Tahrir Square
APRIL 2011, WASHINGTON DC
4. SOUNDBITE (English) Masood Ahmed, Director, Middle East and Central Asia Department, International Monetary Fund:
“The financial and economic outlook for oil-exporting countries in the Middle East is better this year, mostly because of higher oil prices. As a result, their current account surplus as a group is going to more than double to about $380 billion. Their growth rate will also increase, partly because they’re producing more oil and also because in the train of higher oil production, the rest of the economy is picking up. As a group, they’re expected to grow about five percent this year.”
RECENT – CAIRO, EGYPT
5. Various shots, Stock Exchange Building
APRIL 2011, WASHINGTON DC
6. SOUNDBITE (English) Masood Ahmed, Director, Middle East and Central Asia Department, International Monetary Fund:
“Over the long term, the answer lies in moving away from generalized subsidies in food and fuel, some of which are captured by the middle class and the rich, to targeted subsidies that focus on households that need the most help. This way, with the same amount of resources, governments can ensure that the poor are adequately protected, and at the same time have less strain on their budgets.”
RECENT – CAIRO, EGYPT
7. Various shots, pedestrians
APRIL 2011, WASHINGTON DC
8. SOUNDBITE (English) Masood Ahmed, Director, Middle East and Central Asia Department, International Monetary Fund:
“Improving the business environment, allowing small businesses to develop, which are often the creators of jobs, is one big part of the solution. The second half of the solution is to ensure that young people, as they come out of schools, as they come out of colleges, have the right kind of skills to take on the jobs of tomorrow.”
RECENT – WASHINGTON DC
9. Close-up, exterior IMF building
The International Monetary Fund’s (IMF) “Regional Economic Outlook for the Middle East and Central Asia” projects growth in the Middle East and North Africa region at 3.9 percent in 2011, unchanged from 2010.
Growth among the region’s oil importers such as Afghanistan, Djibouti, Egypt, Jordan, Lebanon, Mauritania, Morocco, Pakistan, Syria, and Tunisia is set to slow to a mere 2.3 percent.
“As a group, these countries are going to grow about 2 percent this year, which is considerably lower than last year. As a group, their budget deficits are going to increase to over $40 billion this year,” said Masood Ahmed, Director of the Middle East and Central Asia Department of the IMF.
By contrast, the economies of oil-exporting countries such as Algeria, Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, Sudan, the United Arab Emirates, and Yemen are expected to expand by 4.9 percent (projections exclude Libya), owing largely to higher oil prices and oil production.
“The financial and economic outlook for oil-exporting countries in the Middle East is better this year, mostly because of higher oil prices. As a result, their current account surplus as a group is going to more than double to about $380 billion. Their growth rate will also increase, partly because they’re producing more oil and also because in the train of higher oil production, the rest of the economy is picking up. As a group, they’re expected to grow about 5 percent this year,” said Masood Ahmed, Director of the Middle East and Central Asia Department of the IMF.
Both the surge in global commodity prices and the widespread social unrest in the region have changed the outlook for 2011. Higher oil prices have further strengthened the external and fiscal positions of oil exporters, while oil importers have seen their import bill rising and domestic pressures mounting in the face of higher food and fuel prices.
The unrest has caused short-term disruptions to economic activity in a number of countries. More generally, developments have dented investor confidence and weighed on tourism and foreign direct investment throughout the Middle East and North Africa.
To mitigate the impact of higher food and fuel prices and stem the social unrest, governments in the region have been expanding subsidies, raising wages and pensions, making additional cash transfers, stepping up other public spending, and reducing taxes.
Ahmed said the cost of these new measures ranges widely across countries, but is, in many cases, substantial.
“Over the long term, the answer lies in moving away from generalized subsidies in food and fuel, some of which are captured by the middle class and the rich, to targeted subsidies that focus on households that need the most help. This way, with the same amount of resources, governments can ensure that the poor are adequately protected, and at the same time have less strain on their budgets,” said Masood Ahmed, Director of the Middle East and Central Asia Department of the IMF.
Throughout the region, the slow growth equilibrium of the past years did not generate enough jobs for the growing labor force in a region where youth unemployment rates register well above 20 percent in a number of countries. Moreover, the report said there was an increasing sense that business environments were suffering from unfair competition, with systems benefiting a privileged few.
“Improving the business environment, allowing small businesses to develop, which are often the creators of jobs, is one big part of the solution. The second half of the solution is to ensure that young people, as they come out of schools, as they come out of colleges, have the right kind of skills to take on the jobs of tomorrow,” said Masood Ahmed, Director of the Middle East and Central Asia Department of the IMF.
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