Wednesday, April 18, 2007

World Bank Report Reveals Reform Progress in Trade, Business Environment and Governance in MENA Region

Source: World Bank
2007 MENA Economic Developments and Prospects Report

The World Bank Middle East and North Africa (MENA) region launched a new report that looks into economic trends and prospects for the region. This is an advanced edition and the final report will be released in May 2007.

This is the third of an annual series of reports. The theme for this year's publication is labor markets and employment, a critical area for the MENA region as a result of its strong labor force growth and large share of young population.

High economic growth has been accompanied by strong job creation and declining unemployment in recent years. But for this performance to be sustainable it needs to be supported by deeper structural reforms in countries of the Middle East and North Africa region.

According to the report, the GDP growth reached 6.3% for the region in 2006 – up from an average of 3.6% a year during the 1990s. This is the fourth year in a row of robust growth performance, driven by high oil prices, economic recovery in Europe and reforms that are broadly going in the right direction. As a result, many jobs have been generated, primarily by the private sector as public employment slows down.

"Countries in the MENA region need to remove the remaining barriers that hinder the business environment for the private sector in order to maintain growth, increase private investment and generate more jobs" said Daniela Gressani, World Bank Vice President for the MENA region.

Indicators reveal that employment grew at 4.5% per annum in 2000-05, the strongest rate of job creation among developing regions. However, the report indicates that productivity remains a concern and women are still less successful than men in finding jobs. "Too many jobs are still being created in sectors with low or declining productivity" said Carlos Silva-J√°uregui, Lead Economist and principal author of the report.

Question: What can be done in the MENA region to establish the structural reforms required to balance growth with labor productivity and job creation?

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