Delta variant poses biggest threat to non-Gulf economies

Concerns about the Delta variant of COVID-19 have grown over the past week but high vaccine coverage in the Gulf means that policymakers are unlikely to resort to harsh containment measures. Other parts of the region are more susceptible, adding to the reasons to think that recoveries there will lag behind in the coming years.
Jason Tuvey Senior Emerging Markets Economist
Continue reading

More from Middle East

Middle East Economics Weekly

Lebanon and Tunisia face a tough task to tackle crises

The IMF confirmed this week that technical talks with Lebanon have restarted. But even before any sort of deal is reached, the government has the tough task of restructuring its defaulted Eurobond debt. And any lending from the Fund will come with a long list of reforms that will be difficult to implement. Elsewhere, Tunisia’s government has also begun talks with the IMF in hopes of securing a fresh deal and is reportedly in talks with the Gulf over financing too. But without reforms to address the deteriorating public finances, this funding would only kick the can down the road and delay a debt restructuring.

21 October 2021

Middle East Economics Update

What does the energy price surge mean for the Gulf?

Higher oil and gas revenues are likely to prompt a modest shift to looser fiscal policy in the large Gulf economies, although Bahrain and Oman will still need to stick to austerity. Meanwhile, if OPEC+ were to raise production quotas more quickly in response to the surge in global energy prices, that would pose a major upside risk to our above-consensus GDP growth forecasts.

20 October 2021

Middle East Economic Outlook

Gulf to outperform

Economic recoveries in the Gulf will continue to gather pace over the coming year on the back of successful vaccine rollouts and higher oil output, and our GDP growth forecasts lie above the consensus. Outside the Gulf, though, recoveries are likely to be slower, particularly in the more tourism-dependent economies. We think a sovereign default in Tunisia is more likely than not, and we have long-standing worries about public debt in Bahrain and Oman as well as Dubai’s corporate debts.

19 October 2021

More from Jason Tuvey

Africa Economics Weekly

South Africa after the unrest

There are signs that the worst of the violence and unrest that has gripped South Africa this week may be over. Any hit to economic activity is unlikely to be long-lasting but the risk that the government’s austerity plans are watered down has increased.

16 July 2021

Emerging Europe Economics Update

CBRT in no rush to lower interest rates

Turkey’s central bank (CBRT) left interest rates on hold at 19.00% today and, with inflation set to rise further in July from a two-year high last month and the economy bouncing back quickly from the three-week lockdown in May, we think that an easing cycle is unlikely to begin until late this year.

14 July 2021

Africa Economics Update

Assessing the impact of the unrest in South Africa

There is clearly a lot of uncertainty over how the protests in South Africa in recent days will develop but there are reasons to think that the impact on economic activity will be towards the milder end of the spectrum. Perhaps a bigger risk is that the protests signal broader discontent with the current weakness of the economy, limiting the government’s ability to push through austerity and put the public debt position back on to a sustainable path.

13 July 2021
↑ Back to top