Economics of the Middle East

The following sections are included:

• Contents
• About the Author

Similar to other developing regions, Middle East and North Africa (MENA) economies achieved very high growth during the 1950s and 1960s with per capita GDP rising more than seven times from 1960 to the mid-1980s. By the late 1970s and 1980s however, growth had collapsed and economic activity in many economies languished for nearly two decades. In the early to mid-2000s, growth accelerated rapidly, linked in part with higher oil prices and more favorable global economic circumstances…

In 1960, a small organization functioning more or less like a trade union was created by five oil exporting developing countries. By the mid-1970s, this organization, the Organization of the Petroleum Exporting Countries (OPEC) had grown to 12 members, the majority from the Middle East and North Africa (MENA) region and came to represent more than half of world oil exports and nearly all of the spare oil production capacity in the global economy…

In the brief period from 1970 to 1974, government revenues of Organization of the Petroleum Exporting Countries (OPEC) nations increased 11 times and OPEC developing countries gained pricing power over the world's most valuable traded commodity. This oil windfall, followed by two others (1979/1981 and 2003) had significant effects on growth, development, and political economy in the economies of the Middle East and North Africa (MENA) region…

Managing water resources pose significant challenges for policymakers globally — the amount of water readily available for human use is less than 1% of total water resources in the world…

The following sections are included:

• Introduction
• MENA Trade and Integration
• Toward New Directions in Trade and Integration
• References

Despite two decades of trade liberalization and reforms, Middle East and North Africa (MENA) countries face challenges in diversifying export products. Non-oil export capacity for this region of 400 million people is comparable to that of Switzerland. Moreover, FDI flows remain concentrated in a handful of sectors and the region is only weakly integrated in global supply chains…

Relative to other developing regions, most Middle East and North Africa (MENA) countries have relatively low levels of private investment and private sector activity. Moreover, the business landscape is populated by a handful of globally successful firms and large growing numbers of low productivity very small and medium-sized firms (SMEs). Market dynamism is hampered by low business entry and firm growth is constrained by market-segmentation regulations and enforcement. Underdeveloped financial markets also play a role…

Relative to other developing regions, Middle East and North Africa (MENA) countries have low levels of poverty and a relatively equitable income distribution. Moreover, from a historical perspective, governments in the region have tended to spend more on the unemployed, the disabled, and the poor, relative to levels in industrialized countries at historically similar levels of per capita income…

The following sections is included:

• Index