The Middle East & North Africa region will struggle again next year, recording its weakest economic growth since the global financial crisis in 2009. Fiscal policy will have to be tightened in most places in order to rein in twin budget and current account deficits. Dollar pegs in the Gulf will remain in place but that means policymakers will be forced to follow the US Federal Reserve and hike interest rates. As a result, growth there is likely to stay subdued. Meanwhile, we expect Egypt’s economy to slow sharply, and by more than most expect, as inflation surges and policy is tightened. The upshot is that growth in the region as a whole is likely to weaken to just 1.5% in 2017.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services