OECD-MENA Tandem Seeks Economic Stability

Nov 26 2009


BERLIN (IDN-InDepthNews Service) – Countries in the extensive Middle East and North Africa (MENA) region are becoming increasingly important for the 30-nation OECD as the world economic crisis cuts growth and sends inward investment reeling.

At the same time, some 40 million new jobs will be required in the next ten years for the soaring population of the region that extends from Morocco in northwest Africa to Iran in southwest Asia, including all the Arab Middle East and North Africa countries, as well as Iran and Israel.

They comprise some 6 percent of the world population and host vast reserves of petroleum and natural gas that make the MENA region a vital source of global economic stability.

Against this backdrop, government ministers, business leaders and representatives of civil society from 18 MENA countries will meet their OECD counterparts in Marrakesh on Nov. 22-23 “to discuss ways to boost employment, spur investment, strengthen governance, and tackle poverty in the region”, says Nicholas Bray, head of media at the OECD (Organisation for Economic Cooperation and Development).

The situation is urgent: annual growth rates that averaged 7 percent in previous years are set to fall to around 4 percent this year. Foreign direct investment inflows into the region are anticipated to plunge by some 30 percent.

Because of this, OECD says, governments need to improve the efficiency of their civil services and attract investment by foreign companies.

OECD argues: Governments have a vital role to play in delivering effective public services and involving citizens, businesses, civil society and media in reform efforts. The participation of women in the economy, in particular, can be a strong driver for growth: women can help to boost social cohesion and job creation if given access to the labor market, whether in the public sector or as entrepreneurs.


An OECD briefing paper says: The global financial and economic crisis has shown that multilateral coordination and common strategies are needed to ensure economic recovery and long term sustainable growth.

All the more so as MENA economies have been hit, like others, by the global recession.


– Economic growth in the region is forecast to fall to around 2.2 percent this year from an annual average of around 5.1 percent between 2000 and 2008.

– Lower demand for oil and lower oil prices have cut the combined current account surplus of the countries in the region to around 7 percent of GDP in 2009, compared with around 14 percent in 2008.

– Unemployment is expected to rise by around 25 percent in the Middle East and by 13 percent in North Africa in 2009, compared with 2007 levels.

“The good news is that we are starting to witness signs of stabilisation and recovery. But managing this recovery poses a series of important challenges,” the paper states.

These challenges include:
– creating more and better jobs, in particular for young people; economic diversification;

– ensuring that all members of society, including women and people in rural areas, can participate in economic activity;

– developing efficient public services and an active financial sector;

– tackling issues like access to water, the need for improved education, improved welfare and better living conditions for all through efficient public services that deliver responses to citizens’ needs.

“Moments of crisis can accelerate reform agendas, as obstacles to implementation can be overcome when the need for immediate policy responses is better understood,” the paper strikes an optimistic note.

According to Bray, during the course of the two days of meetings:

– Morocco will join the 30 OECD countries and 11 others, including Egypt, in signing the OECD Declaration on International Investment and Multinational Enterprises. This is a policy commitment by governments to support an open environment for international investors and encourage responsible investment by multinational companies as a means to promote prosperity and growth.

– The first Progress report on Public Governance Reform in the Middle East and North Africa will be presented in the Ministerial panel of the Governance Programme.

– Egypt, Italy, and the OECD will announce the first e-Government review to be undertaken under the MENA-OECD Governance Programme, to be financed by Italy and implemented by the OECD in 2010.

This will provide the Egyptian government with a systematic assessment of its performance and challenges within the specific policy area of government transformation with the goal of helping Egypt to:
– Improve e-government policy development and implementation.
– Analyse barriers hindering e-government implementation.
– Prioritise actions to be taken to overcome such barrier.
– Provide other Arab countries with experience and good practices in addressing e-government challenges.

A highlight of the meetings is expected to be an announcement by the Palestinian National Authority and the OECD of a series of specific activities implemented by the MENA-OECD Governance Programme to reinforce capacities and support the implementation of the Palestinian Reform and Development Plan. This project is funded by Norway.


– Summaries of Business Climate Development Strategies for two — not yet named — pilot countries and progress of investment climate reforms will be presented from a large group of MENA countries;
– Timely regional reports on corporate governance of banks and insolvency in the MENA region will be issued building on work conducted over the last two years.
– Ministers of MENA and OECD countries will adopt a Declaration on Policy Responses to the Crisis setting out a series of actions to be taken to enhance economic development and prosperity.

The conference and associated events are the fourth such ministerial-level gathering organised under the MENA Initiative on Governance and Investment for Development. Launched in 2005 as a partnership with OECD countries for governance and investment reform based on policy dialogue and peer advice, the MENA Initiative has led to the creation in several MENA countries of regional training centres focusing on spreading expertise on public management investment, and competitiveness.

Commenting the gatherings, OECD Secretary-General Angel Gurría says: “In helping development through supporting growth and building good governance frameworks, we set the basis for a stronger, fairer and cleaner economy. In improving the business environment in the region, we provide better security for international investors. In doing so, we also promote domestic investment, growth and employment.” (IDN-InDepthNews/20.11.09)

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