Tradeoffs for Transformation in the Middle East and Central Asia- Regional Economic Outlook Middle East and Central Asia
Since the beginning of this year, the Middle East and North Africa region has made good progress and the recovery is ongoing despite the new outbreaks. Yet, the recovery is uneven, incomplete, and fragile. In the Middle East and North Africa, real GDP growth is expected to expand by 4.1 percent in 2021 and 2022. In the Caucasus and Central Asia, real GDP is expected to grow by 4.3 percent in 2021 and 4.1 percent in 2022.
New challenges: With the emergence of new challenges, such as rising inflation and increasing inequities, countries will face delicate policy tradeoffs. Ramping up vaccine acquisition and distribution remains the top short-term priority and will require strong global and regional cooperation. Additional fiscal support should be well-targeted and improving policy frameworks will be important to reduce tradeoffs. Rising inflation warrants close monitoring, and central banks may need to raise interest rates preemptively if inflation proves persistent.
The crisis presents opportunities that could lead to a transformational recovery for the region marked by more resilient, inclusive, and greener economies. Leveraging global trends, such as the use of digital technologies, will help improve the efficiency of safety nets and ensure the region stays competitive globally. Investing in climate-resilient technology will be key to addressing the global existential crisis while also creating new job opportunities.
Next week, the region's economic outlook, with a focus on the Caucasus and Central Asia, will be the subject of an October 27, 7 a.m. ET panel discussion focused on policies that can help the region emerge from the crisis. Register now.
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