Dr. Raja M. Almarzoqi Albqami Institute of Diplomatic Studies · 2016. 3. 29. · Dr. Raja M....
Transcript of Dr. Raja M. Almarzoqi Albqami Institute of Diplomatic Studies · 2016. 3. 29. · Dr. Raja M....
Dr. Raja M. Almarzoqi Albqami
Institute of Diplomatic Studies
3nd Meeting of OECD-MENA Senior Budget Officials Network
Dubai, United Arab Emirates, 31 October-1 November 2010
Oil Exporters
Oil Importers
MENA
Source: IMF
Afghanistan
Pakistan
Iran Iraq
Saudi Arabia
Yemen
Oman
Qatar Bahrain
Kuwait
Sudan
Libya Algeria
Morocco
Mauritania
Lebanon Syria
Jordan
Tunisia
Djibouti
Egypt United Arab
Emirates
West Bank & Gaza
Oil Exporters
Oil importers
Afghanistan
Pakistan
Iran Iraq
Saudi Arabia
Yemen
Oman
Qatar Bahrain
Kuwait
Sudan
Libya Algeria
Morocco
Mauritania
Lebanon Syria
Jordan
Tunisia
Djibouti
Egypt United Arab
Emirates
West Bank & Gaza
Source: IMF
introduction
The growth of the region depends on oil
Growth in the non-oil economies of the Middle East dependence on GCC growth
Financial flow
Remittance
Tourism
GDP growth decline
Investors attitude
Credit sluggish
Oil price reduction
(36%)
4
8
12
16
20
24
28
32
36
Dec-07 Jun-08 Dec-08 Jun-09 Dec-09
Credit to private sector
Deposits
Source: Regional Economic Outlook presentation, IMF
Credit and Deposit Growth
(PPP GDP weighted year-on-year growth rates, percent)
MENAP oil exporters The MENAP oil exporters were hit hard in 2009. Crude oil prices drop to US$40 per barrel, real estate and
asset prices plunged, and external financing dried up. The oil exporters’ combined
current account surplus fell to US$53 billion in 2009, from its peak US$362 billion in 2008.
Oil GDP contracted by 4.7 % in 2009,
Grew by 1.5 percent in 2009.
MENAP oil importers MENAP oil importers have positive spillovers from fiscal
expansions in the GCC countries
Overall growth fell to 3.8 percent in 2009, from 5 percent in 2008.
Since mid-2009 Trade rebounding and investment and bank credit beginning to pick up,
Growth is estimated to increase to 4.1% in 2010 and 4.8 %
in 2011.
Middle East, North Africa, Afghanistan, and Pakistan (MENAP)
Average Proj. Proj.
2000–05 2006 2007 2008 2009 2010 2011
Real GDP Growth (Annual change; percent)
MENAP 5 5.7 5.7 4.6 2.3 4.2 4.6
Oil Exporters 5.3 5.4 5.6 4.4 1.5 4.3 4.5
of Which:
GCC 5.4 5.4 4.2 6.3 0.8 4.9 5.2
Oil Importers 4.4 6.3 5.9 5 3.8 4.1 4.8
Central Government Fiscal Balance (Percent of GDP)
MENAP 1.8 6.7 4.6 6.9 -2.5 -0.3 1
Oil Exporters 5.3 12.8 9.7 13.8 -0.8 2.8 4.6
of Which:
GCC 7.6 22.4 17 26.4 2.1 7 10.3
Oil Importers -4.7 -4.7 -4.9 -5.8 -5.5 -6 -5.4
Current Account Balance (Percent of GDP)
MENAP 8.3 17.1 14.1 13.8 1.2 4.5 6.2
Oil Exporters 12.1 23.4 19.6 19.6 3.4 7.8 10
of Which:
GCC 14.9 28.7 22.8 24.1 6.6 13 15.7
Oil Importers -5.4 -1.6 -2.4 -4.8 -4.5 -4.2 -4
Source: IMF, 2010
Inflation correlated with oil revenue
0
2
4
6
8
10
12
14
16
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Inflation
0
1
2
3
4
5
6
7
8
1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015
Growth of Real GDP in MENA
-100
-50
0
50
100
150
200
250
300
350
400
1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015
Current Account Balance of MENA (Billion of U.S dollar)
Surplus of CA during oil price increase
Source: Regional Economic Outlook presentation IMF
0
1
2
3
4
5
6
7
8
0
2
4
6
8
10
12
14
16
1990 1993 1996 1999 2002 2005 2008
Unemployment rate
Real GDP growth (right scale)
Fiscal MENAP oil exporters were able to undertake large
spending programs concentrated on infrastructure investment.
Saudi Arabia implemented the largest stimulus package relative to GDP among G20 countries in 2009.
Algeria continued public investment program to support nonhydrocarbon activity;
Monetary Policies Central banks in many countries:
reduced reserve requirements
Cut interest rates and maintained them at low levels.
Injecting liquidity or capital into banking systems
Exchange rate regime
2010 Increase crude oil prices to more than US$80 per barrel by the end of last year, have aided the
recovery .
International reserve positions are improving again—by an estimated US$46 billion in 2010.
Higher oil prices and output are projected to boost oil exports by 31 percent to US$682 billion, more than double the current account surplus, to US$140 billion,
This will boost oil-GDP growth to 4.3% in 2010.
Many governments—most notably in Saudi Arabia—are planning to expand
spending. This stimulus will continue to buoy domestic non-oil-sector activity, projected to grow by 4.1 percent
Sustain positive spillovers to neighboring countries through trade.
Stocks are up still well below earlier highs and volatile
Change in the global economy
Population growth
Flow of capital
Trade
Increasing economic contribution of developing countries G-20
Financial crisis and the issue currencies
Investment (Gross Fixed capital Formation ) / GDP in 2009
Above 30% in most of developing countries (ex. China 45%, India 32%,Indonesia 31%, S. Korea 29.3%)
Below 20% in most of industrial countries (ex. US 12.3%, UK 14%, Germany 17.9%); (Source: www.CIA.gov)
Redaction of USA economy size and increase of China economy size and other developing countries.
Diversification of currencies portfolio
Cont…
Reduce of Market in Industrial countries
Increase market capitalization for Asia-Pacific
Source:www.world-exchanges.org
Americas
53%
Asia -Pacific16%
EAME
31%
Market capitalization - 2000 Breakdown
Americas41%
Asia -Pacific31%
EAME
28%
Market capitalization - 2009 Breakdown
Share trading value
Value of share trading in the Electronic order book in 2009 and 2008
Exchange
USD bn USD bn % change
2009 2008
1 NYSE
Euronext US 17 521 27 651 -36.6%
2 NASDAQ OMX
US 13 608 23 845 -42.9%
3
Shanghai
Stock
Exchange
5 056 2 584 95.7%
4
Tokyo Stock
Exchange
Group
3 704 5 243 -29.4%
5
Shenzhen
Stock
Exchange
2 772 1 242 123.2%
6
NYSE
Euronext
Europe
1 935 3 837 -49.6%
7 London Stock
Exchange 1 772 3 844 -53.9%
8 Korea
Exchange 1 570 1 435 9.4%
9 Deutsche
Börse 1 516 3 148 -51.8%
10 Hong Kong
Exchanges 1 416 1 562 -9.3%
Investment flows – capital raised by shares (IPOs and secondary market issues)
Investment flows in 2009 and 2008
Exchange
USD bn USD bn % change
2009 2008
1 NYSE
Euronext US 234,2 280,2 -16.4%
2 London Stock
Exchange 122,3 124,6 -1.8%
3
Australian
Securities
Exchange
86,2 48.9 76.3%
4 Hong Kong
Exchanges 81,4 55,0 48.0%
5
Shanghai
Stock
Exchange
47,7 27,6 72.8%
6 Tokyo Stock
Exchange 44,2 13,8 220.3%
7 BM&FBOVESP
A 41,7 28,8 44.8%
8 Borsa Italiana 25,9 11,1 133.3%
9
Shenzhen
Stock
Exchange
25,4 17,4 46.0%
10 BME Spanish
Exchanges 21,6 32,2 -32.9%
Restriction and limitation on Growth
Most of the empirical literature in the MENA region suggests that the region trades significantly less than would be expected
transport constraints
inefficiencies in customs clearance processes,
The lack of adequate infrastructure
logistics, and communications costs
The key direct constraints to growth in the MENA region are difficulties in access to finance,
labor skill mismatches and shortages,
electricity constraints.
The quilt of public services
lack of adequate infrastructure