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.

Capital Choices analyzes the creation of different SWFs from a comparative political economy perspective, arguing that different state-society structures at the sectoral level are the drivers for SWF variation. Juergen Braunstein focuses on the early formation period of SWFs, a critical but little understood area given the high levels of political sensitivity and lack of transparency that surround SWF creation. Braunstein’s novel analytical framework provides practical lessons for the business and finance organizations and policymakers of countries that have created, or are planning to create, SWFs.

In response to the global pandemic, public authorities in Egypt responded with a comprehensive package aimed at tackling the health emergency and supporting economic activity. This column examines how private sector firms perceived ease of access to finance before and after the emergence of Covid-19 in 2020.

As economies begin to orient themselves towards recovery and growth in a post-COVID-19 era, they will first need to disentangle themselves from their prior bedfellows, the state, whose courtship was necessary for survival during the pandemic.  Such bedfellow relationships have become increasingly common as government intervention is urgently needed for economic stabilization. Governments have also embraced their new role with vigor. According to the IMF, as of April 2020, countries have committed around $8 trillion to combat the pandemic and to remedy its ill effects on economies and societies. Decisions about how this money will be spent will undoubtedly recalibrate the logic of capitalism for years to come. 

Juergen Braunstein and Sachin Silva argue that sovereign wealth funds may be central to governments' efforts to balance public responsibility with private interests in post-pandemic economies.

As the divergent experiences of the US and South Korea show, testing can be the difference between disease containment and catastrophe. Rather than relying on national governments to ensure the rapid development, production, and deployment of diagnostics during outbreaks, the world needs a global coordinating platform.

The world is on the cusp of a geopolitical reset. The global pandemic could well undermine international institutions, reinforce nationalism and spur de-globalization. But far-sighted leadership could also rekindle cooperation, glimmers of which appeared in the G-20’s offer of debt relief for some of the world’s poorest countries, a joint plea from more than 200 former national leaders for a more coordinated pandemic response and an unprecedented multinational pact to arrest the crash in oil markets.  

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.

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?

Meghan L. O’Sullivan, Professor of International Affairs at Harvard’s Kennedy School, former National Security Council advisor, and a Bloomberg Opinion columnist, discusses the oil market plunge, and the Russia-Saudi relationship. Hosted by Lisa Abramowicz and Paul Sweeney.