IMF cuts Middle East growth forecasts on global trends, unrest

[k98nights]

Oct 08 2014

IMF cuts Middle East growth forecasts on global trends, unrest

Photo Credit:Reuters/Sebastien Pirlet

DUBAI, Oct 8 (Reuters) - The International Monetary Fund cut its economic growth forecasts for many countries in the Middle East, citing the impact of political unrest as well as a weaker global outlook.

Output in the Middle East, North Africa, Afghanistan and Pakistan is now expected to expand 2.7 percent this year, 0.4 percentage point slower than the IMF's last forecast made in July, the Fund said in its twice-yearly World Economic Outlook, issued this week.

Next year, growth in the region is expected to accelerate to 3.9 percent - but that is 0.9 percentage point slower than the IMF's July forecast.

Middle Eastern oil exporters can look forward to only a modest rise in global oil demand while oil supply in North America is rising, the IMF said. Brent crude oil slipped below $91 a barrel on Wednesday to its lowest level since June 2012, down more than $20 since June this year.

Thanks to heavy government spending and robust private sectors, economies in the six-nation Gulf Cooperation Council are expected to stay strong. GCC growth is now projected to average about 4.5 percent annually in 2014-15, with non-oil gross domestic product expanding 6 percent and oil GDP rising just 0.5 percent, the IMF said.

Among the non-GCC oil exporters, however, growth is forecast to average only 0.25 percent in 2014 because of recent political shocks and worsening security in Iraq, Libya and Yemen.

Growth is projected to recover to 3 percent in 2015, assuming a rebound in oil production in those three countries, but that assumption is "subject to significant uncertainty", the IMF said.

Meanwhile, the economies of many Middle Eastern oil importers continue to struggle because of "deep-rooted inefficiencies in economic structures, regional conflicts, and continued sociopolitical tensions", the IMF added.

"Growth is still too weak to tackle persistently high unemployment, especially among the young, and widespread socioeconomic inequities."

The IMF predicts growth of 2.6 percent this year for oil importers in the Middle East, North Africa, Afghanistan and Pakistan, in line with its forecast made six months ago. But it has reduced its 2015 forecast by 0.5 percentage point to 3.7 percent.

Egypt's presidential election and aid from the GCC have restored some confidence and stabilised growth, but more reforms and aid will be needed to create jobs, the IMF said.

It now predicts growth of 2.2 percent for Egypt this year and 3.5 percent next year, down from forecasts made in April of 2.3 percent and 4.1 percent.

In Morocco, the IMF said, "the ongoing implementation of structural reforms is beginning to bear fruit, and growth is expected to pick up in 2015. Private investment is expected to strengthen with increased confidence, rising tourism receipts, and stronger export performance."

But the IMF still cut its Moroccan growth forecasts, to 3.5 percent from 3.9 percent in 2014 and 4.7 percent from 4.9 percent in 2015.

(Reporting by Andrew Torchia; Editing by Olzhas Auyezov) ((andrew.torchia@thomsonreuters.com; +9715 6681 7277; Reuters Messaging: andrew.torchia.thomsonreuters.com@reuters.net))

http://www.zawya.com/story/IMF_cuts_Middle_East_growth_forecasts_on_global_trends_unrest-TR20141008nL6N0S32YUX2/#utm_source=zawya&utm_medium=web&utm_content=image-toolbox&utm_campaign=free-homepage

[calkid11]

Thank you Woody very interesting.

[SocalDinar]

The International Monetary Fund announced that the economy of Iraq, "shrink" this year

 

 

2014/10/08 17:11 10/08/2014 17:11

 

Awan / Baghdad

IMF  IMF announced IMF, on Wednesday, that the Iraqi economy will be subjected to shrink this year because of the battles plaguing the country, changing its previous forecast that the occurrence of a healthy growth in the country, as pointed out that the economic growth rate was 4.2%.

. The International Monetary Fund said in its report for the month of October and seen by "Awan", that "there are expectations of a contraction rate of GDP growth for Iraq for this year by 2.7%, representing a decline from the forecast growth of the Iraqi economy by 5.9% during the month of April."

وThe report added that "the rate of economic growth in Iraq over the past year was up 4.2% and it is expected that the re-growth through the year 2015, an increase of 1.5%, which is less than the growth rate amounting to 6.7% predicted by the International Monetary Fund for Iraq during the month of April."And between the International Monetary Fund in its report, "The fighting in northern Iraq began Ptathiradtha negative growth factors is oil in the country, and despite the fact that most of the oil production stationed in southern Iraq and that the rates of oil production was not affected materially the departure of skilled labor will limit the ability of Iraq to expand or perhaps not even maintain the current production level. "

. He said the IMF also said that "expectations processing disorder Iraqi oil to world markets due to the escalation of fighting in which it may lead to higher oil prices by up to 20%."

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[thylocene]

It doesn't paint a very rosy outlook for Iraq.  ISIL is stuffing up everything.

[SocalDinar]

It doesn't paint a very rosy outlook for Iraq.  ISIL is stuffing up everything.

I'm amazed the Market rate is where its at Thylocene. Does not make sense to me.

[blitzer]

I'm amazed the Market rate is where its at Thylocene. Does not make sense to me.

 

That is because the CBI is still using the "managed currency" program initially installed by the IMF.  Iraq does not HAVE to remain in it anymore, but they can CHOOSE to do so.  And because they have chosen to do so, it has allowed the IQD to remain basically unchanged throughout all the political and physical violence.

 

And that is why, lol, any other country that is talking civil unrest, war and invasions, or is even considering it, have their value go down, and Iraq just stays stable at 1166.

 

You figure USA, Russia, the EU, etc., everyone's money goes up and down on the slightest provocation of unrest or worry, lol, but Iraq just stays there at 1166, day after day, you KNOW that can't be right unless it is still being "managed".