Gross domestic product in the Middle East and North Africa’s is likely to grow 2.4 percent in 2021, as higher crude prices and the roll out of vaccines drive recovery in oil-exporting countries, according to the World Bank.
The recent forecast is 0.3 percentage points higher than initially projection in January, the World Bank said in its latest Global Economic Prospects report on Wednesday.
“The region should benefit from the recent recovery in oil prices, stronger external demand and less economic disruptions from Covid-19 outbreaks,” the report said.
Growth in Mena’s economies is likely to speed up to 3.5 percent in 2022 on the back of vaccinations, easing mobility restrictions and rising oil production that will drive more revenue for the oil-exporting countries.
The World Bank also upgraded the global economic growth outlook to 5.6 per cent in 2021 – the fastest post-recession pace in 80 years – up from 4 per cent projected earlier this year as the world emerges from the pandemic-induced slowdown. It follows similar revisions from the International Monetary Fund, which raised its global economic outlook for this year to 6 per cent in April from an earlier 5.5 per cent forecast.
“As the health crisis eases, policymakers will need to address the pandemic’s lasting effects and take steps to spur green, resilient and inclusive growth while safeguarding macroeconomic stability,” World Bank Group president David Malpass said.
The coronavirus pandemic has also reversed poverty reduction gains in many low-income countries, further aggravating the inequality between the developing and developed countries, the lender noted.
In the Mena region, oil-exporting countries are expected to fare better this year as higher crude prices bolster their finances.