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Expectations of the growth rate of Arab countries by 3.1% in 2019 from the morning, on Sunday, April 28, 2019.
The Arab Monetary Fund expects Arab countries to grow 3.1% in 2019 and 3.4% by 2020, reflecting the expectations that the growth rate of the Arab oil exporting countries will continue to increase to 2.8 and 3 , 1% in 2019 and 2020, respectively, In the midst of an expected divergence of trends in economic activity throughout the Group.
This was stated by Arab Economic Outlook, published by the fund for the month of April, which included an update on the economic performance forecasts of Arab countries at various levels, including economic growth, trends in development of domestic prices, monetary and financial conditions and expectations of the foreign sector in Arab countries during 2019 and 2020.
The report noted that the most prominent political priorities of Arab countries are the creation of more employment opportunities to face the challenge of unemployment in the light of the high rate of # 39 unemployment in Arab countries that will almost double the worldwide unemployment rate. The unemployment challenge in Arab countries is concentrated in the youth sector, especially in women, where the youth unemployment rate rises to 26%, according to data from the World Bank, which is also twice the average worldwide Globally, 40% is compared to 15% of the world average.
The possible repercussions of the Fourth Industrial Revolution and subsequent technical developments increase the magnitude of the challenges that Arab countries face in the future.
Addressing the challenge of unemployment requires that Arab countries adopt an integrated approach based on a comprehensive transformation of the structures of Arab economies, increasing the dynamics of the labor market, facilitating access to finance, adopting reforms Institutional to increase the flexibility of labor markets and products. In addition to the establishment of educational observatories to explore the needs of labor markets, seek greater integration in the global economy and conclude liberalization agreements Commercial and transfers of capital and labor.
With regard to trends in the development of domestic prices, the rate of inflation in Arab countries will be reduced to 9.3% and 8.1% during 2019 and 2020, respectively, as a result of the low rate of inflation in Arab exporting countries at 6.1% and 5.9%, respectively. By 2019 and 2020.
At the subgroup level, GCC inflation is expected to fall around 1.3% in 2019, while inflation is expected to be around 1.6% on 2020. In other oil producing countries, the inflation rate stood at around 6.3% during 2019. While it was projected to reach around 6.5% in 2020.
In the group of Arab oil importing countries, inflation is projected to fall to around 11.8 percent in 2019 and 9.9 percent by 2020.
Regarding monetary conditions, it is expected that during the years 2019 and 2020, monetary conditions in Arab countries will be affected by economic trends, external demand levels and monetary policy positions in the United States and the European Union .
In this context, it is expected that the return of traditional monetary policy in the United States and the euro zone will have consequences for monetary conditions in countries that adopt fixed exchange rate regimes, which will affect the cost of national financing and external and of the capital flows.
In countries that adopt more flexible exchange rates, some improved monetary conditions in some will be linked to the improvement in external demand levels, which will support the net foreign assets, will help provide domestic loans and reduce interest rates and will help reduce pressures in the foreign exchange market.
Regarding the financial situation, it is expected that the combined budget deficit of Arab countries as a percentage of GDP will decrease to 5.5% in 2019, reflecting the expected impact of fiscal reforms taken during the projected horizon.
Regarding the external sector, the current account surplus is expected to stabilize around 1.6 percent of GDP in 2019 and 2020.