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DUBAI, United Arab Emirates (AP) – The coronavirus pandemic has led almost every country in the Middle East to the agony of an economic recession this year, but an uptick is expected as all of Lebanon and Oman are expected to rejoice at some economic level. . next year, according to a report published Monday through the International Monetary Fund.
This occurs when the IMF estimates that the economy will contract by 4. 4% this year, representing the worst annual decline since the Great Depression of the 1930s.
Long before the coronavirus spread around the world, several Middle Eastern countries faced unrest ranging from falling oil costs and slow economic expansion to corruption and peak unemployment.
The IMF predicts that the Lebanese economy will revel in one of the largest economic contractions in the region this year, with 25% after a wave of anger against the government before the virus arrives.
Lebanese protesters opposed government corruption, currency shortages, hyperinflation, constant power cuts and poverty development. The currency has fallen by 70% compared to the end of last year, as other people are suffering from raw materials. Another 180 people were killed, more than 6,000 people were injured and entire neighborhoods destroyed. The explosion left thousands homeless.
While Middle Eastern countries have noticed fewer samples and deaths from the virus than countries in Europe and the United States, the region still faces demanding situations to contain the disease.
“The dangers of a worse-than-expected situation are significant, especially given recent outbreaks of COVID-19 infections in many countries around the world that have reopened,” the IMF warned.
“Iran was one of the first countries to have an epicenter of COVID-19 and we are now on the third wave of the pandemic, and this adds to an economy that performed lower because of (American) sanctions,” Jihad Azour, director of the IMF’s Middle East and Central Asia Department, told The Associated Press.
Meanwhile, rich oil exporters in the Middle East are expected to reduce their economies by 6. 6% by 2020, the IMF said; however, The Gulf Arab States are expected to enjoy an average economic expansion of 2. 3% next year. Projections are based on assumptions that the value of oil will average $41. 69 consistent with the barrel by 2020 and increase to $46. 70 consistent with the barrel in 2021.
The IMF revised its bleak estimate of Saudi Arabia’s economic downturn from 6. 8% to 5. 4%. As one of the world’s largest oilmakers and the world’s 20 largest economies, the kingdom has taken this year the audacity to verify to increase its revenue through tripling value-added tax to 15% and extending tariffs.
Egypt, the only outlier in the region, recorded a modest expansion of 3. 5% this year after an annual expansion of more than 5% in more than two years, with energy costs falling. as an oil importer. However, Egypt faces demanding situations with its large population and the source of tourism’s income remains low.
The IMF, known for its positive stance on tax and subsidy cuts, has largely suspended its demands for stricter austerity measures while others struggle under the weight of blockades and job losses. most effective after the crisis “because such measures” will most likely hinder the recovery and lead to higher budget prices in the future.
The foreign lender asks countries to focus their immediate priorities on ensuring sufficient resources for health care and properly focusing
Meanwhile, other oil exporters in the Middle East, such as the United Arab Emirates, home to Dubai and Abu Dhabi, will revel in an economic contraction of more than 6% this year, while Oman’s economy is expected to contract by 10%. Recession of 12%, the IMF said.
The World Bank estimates that the pandemic has thrown between 88 and 114 million more people into excessive poverty, which is explained by living on less than $1. 90 a day.
According to the International Labour Organization, operating hours in Arab states decreased by 1. 8% in the first quarter of 2020, to approximately 1 million full-time jobs, more than 10. 3% in the current quarter, to about 6 million full-time jobs.
While Middle Eastern states rushed to provide diverse aid bureaucracy to their own citizens amid the pandemic, the effect of the virus felt strongly in many countries. Their families at home have their wages to survive.
Azour said Persian Gulf states alone supply 18% of global remittances. He said those countries deserve to take the opportunity to “modernize labour laws” by offering to all staff in their countries.