Since the global financial crisis of 2008, emerging market economies have experienced a surge in capital flows in response to significant monetary easing by major central banks. Gross capital inflows to the Middle East and North Africa (MENA) have remained high compared to other emerging markets, but their composition has changed significantly, with a surge in portfolio flows (equity and bond instruments) and a decline in foreign direct investment. […]
The Middle East and North Africa (MENA) region suffers significant shortcoming in data, which are particularly problematic at a time economic transition. There are important data gaps, poor data quality and in many cases, internationally agreed standards of statistical methodologies, compilation periodicity and timeliness, and data dissemination practices are not followed.
Just as the "Arab Spring" opened a debate about politics in the Middle East, we now need an "Economic Spring" on how to rethink the region's economic future. Of course each country will have to define its own strategy, but there will be some common issues that will have to be addressed.
We know that social exclusion and unemployment, especially among young people, are very painful and that the challenges ahead are formidable. We should not let the hopes and aspirations of the people who took to the street go unfulfilled. We must strive to ensure that the people of the Arab countries in transition have the opportunity for a fairer and more prosperous future.
Young people were innocent bystanders in the global financial crisis, but they may well end up paying the heaviest price for the policy mistakes that have led us to where we are today. Young people will have to pay the taxes to service the debts accumulated in recent years.
The informal economy is large and pervasive—and, often, ignored; however, the experience of those who work in the informal sector came under the media spotlight when Tunisian street vendor Mohamed Bouazizi set himself on fire that fateful day in December last year, sparking the Arab Spring protests.
For the six oil-importing countries in the Middle East and North Africa region—Egypt, Jordan, Lebanon, Morocco, Syria, and Tunisia—high unemployment is a chronic problem. Averaging above 10 percent for the past two decades, unemployment rates here are among the highest in the world. And, youth unemployment is even more alarming at over 20 percent. Given the enormous economic and social costs of unemployment, the region can no longer afford the status quo. These countries need to create about 18? million full-time jobs over the next decade to provide employment for young people looking for their first job and to bring down unemployment. But, why is unemployment chronically high? And what needs to be done to fix it?