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Survey of economic and social developments in the Arab region 2013-2014

image of Survey of economic and social developments in the Arab region 2013-2014
The Arab region saw slower economic growth in 2013, mainly because of the moderate growth of major oil-exporting countries, represented by the member countries of Gulf Cooperation Council. While GCC countries are on a stable recovery path, the polarization of economic performance among Arab countries continues between GCC and other Arab countries. The political, security and humanitarian crisis in Iraq, Libya, Palestine and the Syrian Arab Republic deepened, impacting the region negatively, now increasingly being viewed as fragile and chaotic despite its vast natural resources. This report discusses the issue of current financing gaps, estimates conceptual financing gaps to achieve full employment, and concludes with a set of policy recommendations. As outlined in the report, regional integration has the greatest potential to unlock financial resource mobilization and diversification, and should be utilized as a tool for economic and social transformation across the Arab region.

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Preface

In the wake of the global financial crisis, Arab economies were praised for their resilience and mitigation against the adverse effects of the crisis, which were felt far less severely than in other regions. During 2008 and 2009, Arab policymakers managed to use macroeconomic tools to stabilize their economies and weather the global liquidity crunch. Yet despite this resilience, Arab economies continue to face structural rigidity that has left the region with low economic diversification, high unemployment, stagnated wage growth and persisting gender gaps. The severity of these issues has resulted in their incorporation in the development strategies of Arab countries, including discussions in a series of Arab Economic and Social Development Summit meetings in 2009, 2011 and 2013, producing policy measures to tackle these issues with regional leverages, such as the Arab Customs Union, which is set to be launched in 2015. Despite these policy efforts, the structural weaknesses of Arab economies have not improved visibly. Rather, continuing armed violence, political instability and social unrest in the region are threatening the strength of Arab economies and are marginalizing intraregional economic activities.

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