MENA Economic Outlook 2021: Cautiously optimistic
The MENA region will start to post robust recovery in 2021, but this will not be all-encompassing. The uncertainty regarding the length of the pandemic, new variant(s) of COVID-19, and muted oil demand will remain key downwards risks to the speed of recovery globally this year. This week, we analyse the 2021 economic outlook for the region, focusing on:
- The uncertainty regarding compliance to OPEC+ targets following Saudi Arabia's voluntary gesturing of an additional 1M bpd cut for the next two months.
- The improving growth GCC countries are set to register, supported by their greater access to vaccines and the ability to cut the pandemic-related stimulus measures.
- The likely balance sheet deterioration across MENA despite sharp budgetary cuts.
- The severely constrained medical capabilities and a rising death rate in less well-equipped MENA countries like Iraq and Iran, and in GCC states like Oman.
Florence Eid-Oakden, Ph.D, Chief Economist
Ghalia Al Bajali, Analyst
The Regional Views series are thematic papers aimed at identifying and analysing factors behind medium to long-term economic trends shaping the region. Our analysis draws conclusions that help businesses and investors get ahead of the curve. As a firm staffed by Middle Easterners, we focus on insight rather than standard analysis.
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