Country Report
Egypt’s economic growth will slow in 2016, as tourism is hurt by last year’s terrorist attacks. The industrial sector is helped by an EGP devaluation and the resulting greater access to FX. The lack of structural reforms will continue to weigh on growth.
Country Report
Ongoing low oil prices and social unrest have slowed economic growth, severely affected public finances, and weakened external balances. Solid austerity measures are necessary, but require sufficient public support to avoid more social unrest.
Country Report
Lower oil prices put increased pressure on the Saudi economy. Growth is slowing down and the fiscal situation is under pressure. Implementation of the diversification plan (vision 2030) would be a positive factor, but will be difficult to achieve.
Country Report
Although the UAE’s economy is more diversified and less dependent on the oil sector than the surrounding Gulf States, low oil prices will continue to negatively affect economic and fiscal metrics. Despite the expected twin deficit in 2016 and 2017, we won’t expect any problems in meeting financing requirements due to UAE’s considerable sovereign wealth fund.
Country Report
Jordan’s social and economic dynamics are severely affected by the Syrian crisis, while the government is making progress in consolidating the budget and reducing reliance on a limited number of energy sources.
Country Report
Lebanon’s economy continues to show weak growth in 2014 (3%), being adversely effected by the conflict in Syria. But the banking sector remains healthy and Lebanon still has ample foreign reserves, which mitigates its otherwise high country risk.
Country Report
Jordan’s economic situation is improving. GDP growth has picked up to 3.1% in 2014, driven by lower oil prices and growth in the tourism sector. The greatest risk is still that the conflicts in Syria and Iraq will lead to negative spill-overs.
Country Report
Economic growth is expected to maintain its momentum in the medium term underpinned by strong domestic demand and economic diversification. However, the combination of high government spending and a decreased oil price puts pressure on fiscal sustainability.
Country Report
Although the UAE’s economy is more diversified and less dependent on the oil sector than the surrounding Gulf States, it is strongly affected by the decreasing oil price since the second half of 2014.
Country Report
Domestic stability in Egypt has improved markedly and the economy is showing timid signs of recovery. The government has engaged in bold reforms. Generous aid from the Gulf Cooperation Council (GCC) countries gives it the financial space to gradually implement those reforms.
Country Report
The Israeli economy is likely to continue to grow at a moderate pace, while the strong growth of mortgage debt and the rise of housing prices pose risks. Meanwhile, a new round of peace talks with the Palestinians is not obvious under a new government that is dominated by nationalists and ultra-Orthodox parties.
Country Report
The growth of Kuwait’s hydrocarbon dependent economy slowed further in 2014, as oil prices slumped. Stimulating development of the non-oil sector requires reforms that will be difficult to pass, especially if they come at a cost of welfare programmes. Meanwhile, the political situation eased somewhat as the current parliament is proving more cooperative.
Country Report
The oil price decline negatively affects economic growth and puts pressure on the fiscal position of Bahrain. Meanhile, Saudi Arabia is still (implicitly) backing the Sunni Al-Khalifa regime, both financially and militarily, in an effort to keep Iran at bay.
Country Report
Economic growth has slowed down and government finances have deteriorated quickly as a result of lower oil prices. After his accession, King Salman has made major changes to the leadership that have consolidated power in the Sudairi clan.
Country Report
Algeria’s social situation remains stable as President Bouteflika was elected for his fourth term in office. The government presented a new five-year plan that once more aims to diversify the economy away from the hydrocarbon sector.