According to forecast made public by an IMF official on Tuesday (30), the region’s GDP will contract more than it had been projected in April, due to the coronavirus impacts on the economy activity and the low prices of hydrocarbons.
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International Monetary Fund has warned about the impacts that coronavirus will have on countries that are fragile and in conflict situations, such as Iraq, Djibouti and Somalia. Economy is expected to shrink by 7% in 2020, and internal problems could increase.
The International Monetary Fund’s Executive Board confirmed that it will supply emergency support to help address the economic impact of the pandemic.
African Arab country will receive an emergency financing of USD 43.4 from IMF to reduce the negative effects of the pandemic on the balance of payments. Djibouti posts lower exports of services and investments.
The International Monetary Fund predicts 3% contraction of the world economy, with GDP shrinking 5.3% in Brazil and 2.8% in the Middle East. Next year, economies are expected to bounce back, provided that policies prove effective.
With Saudi Arabia in the group’s presidency, the world’s biggest economies said they will keep close track of the impact of the pandemic on markets.
An IMF report urges Gulf Cooperation Council member countries to tailor their fiscal policies to match the commodity’s prices, which are expected to decline in the next two decades.
MENA accounted for 20% of total portfolio flows to emerging financial markets from 2016-2018.
Country implements reforms but requires bold and comprehensive reforms to face fiscal deficit and other issues. A team from the International Monetary Fund visited Khartoum and recommended actions to protect the vulnerable sectors.
IMF published economic outlook report for the Arab country as part of its fourth review of an arrangement between both. The body approved more USD 22.8 million for Mauritania.
Country has made progress to maintain economic stability, but challenges remain, such as fiscal imbalances unemployment for youth and women, IMF report reads.
On the back of Expo 2020, the Arab country could see its fastest non-oil growth since 2016. Sustaining it after the expo is a key priority, says IMF.
IMF projects a growth at 6% for the Arab country in Africa this year, up from 5.5% in 2018. Strategies of positioning it as a trade and logistics hub has helped improve local economy.
Fund stressed the huge number of Syrian refugees hosted in the country. However, GDP undergoes a period of weak growth.
