Middle East & North Africa

Ownership of reforms by citizens is often presented as important for success. This paper explores media engagement and support for economic reforms in the Gulf Cooperation Council (GCC) countries using text analysis techniques on publicly available sources. Results show that while reform efforts have intensified in recent years in the GCC, these efforts tend to focus on stronger rather than weaker policy areas, potentially limiting the growth-enhancing effect of reforms. Social media analysis using Twitter shows that the population’s support for reforms has been declining. The analysis of traditional
news media points to more engagement by international than by local media. However, sentiment from international media is less positive about economic reforms in the GCC. Sentiment in international media and social media matters, as evidenced by its positive and strong correlation with FDI inflows into the GCC.

Between October 2020 and May 2021, the Middle East Initiative conducted a series of nationally representative surveys to measure the economic, social, and public health impacts of the COVID-19 pandemic in the Middle East and North Africa (MENA) region.1 Designed and supervised by Tarek Masoud, Faculty Director of the Middle East Initiative, and Yuree Noh, Research Fellow, the surveys collected responses from 8,500 residents of seven countries in the region—Algeria, Egypt, Kuwait, Morocco, Saudi Arabia, Tunisia, and the United Arab Emirates. Our goal is to provide the data and insights needed to develop effective policy responses to current and future public health crises.

This report summarizes our findings on how COVID-19 has disrupted employment, mental health, food security, education, and childcare in the region during its first year. We also show that the consequences of the pandemic were felt most acutely by some of the region’s most vulnerable populations: the poor, women, youth, and children.

The Covid-19 pandemic has drastically disrupted people’s lives, livelihoods, and economic conditions around the world. The global shock has resulted in a tourism standstill (Djankov 2020), significant capital flight (Djankov and Panizza 2020), and a slowdown in remittances (Nonvide 2020), resulting in an urgent balance-of-payments need. Egypt responded to the crisis with a comprehensive package aimed at tackling the health emergency and supporting economic activity. The Ministry of Finance acted swiftly to allocate resources to the health sector, provide targeted support to the most severely impacted sectors, and expand social safety net programmes to protect the most vulnerable. Similarly, the Central Bank of Egypt adopted a broad set of measures, including lowering the policy rate and postponing repayments of existing credit facilities. The next section highlights the experience of firms in Egypt following these policies.

Today’s economic crisis leaves us with an unsettling and perplexing regret. Why weren’t financial portfolios already adjusted for risks that stem from health events such as pandemics? After all, financial portfolios are adjusted for liquidity risks, market risks, credit risks, and even operational and political risks.

Contrary to what US President Donald Trump would like to believe, a pandemic like COVID-19 was predicted as recently as last year. After being caught off guard by yet another catastrophe, one wonders when political leaders, markets, and average citizens will start to take risk seriously.

Could using the cash in your pocket have the potential to spread covid-19? That question has rarely appeared in the news, but many governments and leaders in the digital payments industry are wondering how the virus might impact the use of cash. Several countries have already taken drastic measures to limit circulation of bank notes. Could such interventions lead to the end of cash payments?

Because hand-to-hand exchange of physical currency could transmit the coronavirus, countries around the world are being forced to reconsider the use of cash. In fact, COVID-19 might turn out to be the catalyst that finally brings digital payments fully into the mainstream. Not surprisingly, the digital-payments industry is already focusing on the opportunities created by the crisis.

For Saudis these days, life is a roller coaster. Even as Iranian missiles threaten their national security and livelihood, previously unimaginable social freedoms accelerate. All this leaves some Saudis squealing with delight; others are frozen with fright.

Kuwait has a long history of generosity and has been globally recognized for its humanitarian aid and philanthropic giving. The ruling family, the House of Al-Sabah, and merchant families have been prominent philanthropic leaders in Kuwait. More recently, the growth in personal wealth has allowed more individuals to engage in the charitable sector. Philanthropy in the country is becoming more organized, institutionalized, and visible. In turn, the government is increasingly engaged in regulating the sector.

For the Islamic Republic, resistance to Washington has become a cultural norm, and it considers independence (esteghlal) as the main achievement of the 1979 revolution.  According to Secretary of State Mike Pompeo, Iran would have to meet 12 conditions before the United States will renegotiate the nuclear deal and consider removing its sanctions. These conditions, which are nothing short of surrender on Iran’s part, are either set to force Iran out of the nuclear deal and therefore trigger the return of UN sanctions, or they are a thinly veiled call for regime change.