According to the World Economic Forum’s most recent Chief Economists Outlook, nearly half (48%) of senior analysts worldwide predict that the Middle East and North Africa (MENA) region will experience moderate growth in 2024 and 2025.
According to the International Monetary Fund, growth in the MENA region is anticipated to increase from 2.2% in 2024 to 4% in 2025.
Just 17% of respondents anticipate robust growth in the region this year and the following year, compared to 31% who anticipate weak growth in 2024 and 34% who anticipate weak growth in 2025.
Given that seven out of ten chief economists predict strong or very strong growth in 2024 and 2025, South Asia has the greatest growth potential. Nearly 90% of Americans anticipate high or moderate growth this year, indicating a favourable view as well.
In contrast, Europe trails behind, with over 69% of respondents anticipating sluggish growth in the coming days.
A survey of top chief economists served as the basis for the report. It concluded that the main forces behind “cautious optimism” for a global recovery are “easing inflation and strong global commerce.”
However, both developed (53%) and emerging (64%) nations are becoming increasingly concerned about high debt levels.
Another possible cause of macroeconomic shocks is geopolitical tensions, which 91% of respondents said would thwart international cooperation.
From Europe to the Middle East, the numerous conflicts around the world have harmed country economies both financially and humanitarianly.
According to the report, nations have successfully adjusted to several geopolitical upheavals, but the process is not free.
For instance, after a surge in ship attacks on the Red Sea, shipping prices between East Asia and North Europe more than doubled between April and July 2024.
Furthermore, a 10% decline in worldwide foreign direct investment in 2023 was attributed in large part to escalating geopolitical tensions, according to the most recent World Investment Report.
Global inflation is still declining; according to IMF forecasts, full-year global inflation will drop from 6.8% in 2023 to 5.9% in 2024.
The estimates are still higher than pre-pandemic levels, despite the significant differences between advanced nations (2.7%) and emerging economies (8.2%).
Some 63% of senior economists anticipate mild inflation in the MENA region in 2025, and that number will rise to 68% the following year. Just 11% and 15% of respondents, respectively, anticipate significant inflation in the region in 2024 and 2025, while about 20% predict moderate inflation in both years.
However, the percentage of respondents who predicted substantial inflation in the United States fell from 21% in 2024 to 6% in 2025.
In a similar vein, forecasts of significant inflation in Europe decreased from 21% in 2024 to 3% in 2025.
According to the survey, monetary policy would likely ease throughout the course of the upcoming year, especially in the US (91%), Europe (91%), and China (84%).
Of those in the MENA region, 35% anticipate that monetary policy will stay the same, while 62% anticipate that it will loosen.