Dubai: Economic growth across the oil-importing countries in the Middle East Africa and Pakistan (MENAP) region has picked up pace last year but it is not enough to support the level of job growth required to address the high unemployment in the region, according to the regional economic outlook of the International Monetary Fund (IMF).
According to the IMF estimates, the region needs to create jobs in the range of 22 to 25 million in the next five years or an average of 5 million jobs per year. The current growth rates under 5 per cent is seen insufficient to support the desired job creation in the region.
Regional growth is estimated to have reached 4.2 per cent in 2017. It is projected to increase further to 4.7 per cent this year and to 5 per cent on average during 2019—23, with some countries experiencing appreciably faster growth
At an average of 4.9 per cent over 2018—22, growth rates remain too low to effectively reduce unemployment, particularly for young people With the labour force expected to expand 2.2 per cent a year over the need sustained growth of 6.2 per cent annually just to maintain unemployment at its current level of 10 per cent. Achieving higher growth will require an acceleration in structural reforms that allows the private sector to flourish and generate the required jobs.
Persistent conflicts
“Further strengthening of the outlook for the euro area will continue to support economic activity through exports, remittances, foreign direct investment, and tourism. However, persistent conflicts and their regional spillovers, security concerns, weaker-than anticipated public investment (Afghanistan, Jordan), delays in implementation or completion of structural reforms (Jordan, Morocco, Pakistan,
Tunisia), and political and policy uncertainty (Lebanon, Pakistan) continue to weigh on growth,” said Jihad Azour, the IMF’s Director of the Middle East and Central Asia Department of the IMF.
Overall, the outlook has softened slightly since the October 2017 Regional Economic Outlook.
