nep-ara New Economics Papers
on Arab World
Issue of 2013‒06‒16
seventeen papers chosen by
Quentin Wodon
World Bank

  1. Determinants of Growth and Inflation in Southern Mediterranean Countries By Coutinho, Leonor
  2. A Conceptual Model and Methodology for Evaluating E-Infrastructure Deployment and Its Application to OECD and MENA Countries By Baseem Al-Athwari; Jorn Altmann; Almas Heshmati
  3. دور المشروعات الصغیرة والمتوسطة فى التنمیة الصناعیة لمصر By Elasrag, Hussein
  4. Non-core Liabilities and Credit Growth By Zubeyir Kilinc; Hatice Gokce Karasoy; Eray Yucel
  5. Blue water and the consequences of alternative food security policies in the Middle East and North Africa for water security By Larson, Donald F.
  6. Manufactured Exports and FDI in Southern Mediterranean Countries: Evolution, determinants and prospects By Sekkat, Khalid
  7. Culture nationale et développement de la confiance inter organisationnelle en milieu supply chain : Le cas du Maroc By Mohammed Amine Balambo
  8. Financial Sector Development and Integration in the Southern and Eastern Mediterranean: Towards a long-term sustainable transition By Ayadi, Rym
  9. Convergence and Integration of Banking Sector Regulations in the Euro-Mediterranean area By Ayadi, Rym; Arbak, Emrah; De Groen, Willem Pieter
  10. Financial Development, Bank Efficiency and Economic Growth across the Mediterranean By Ayadi, Rym; Arbak, Emrah; Ben-Naceur, Sami; De Groen, Willem Pieter
  11. Benchmarking the Financial Sector in the Southern and Eastern Mediterranean Countries and Projecting 2030 Financial Sector Scenarios By Ayadi, Rym; Arbak, Emrah; Ben-Naceur, Sami; De Groen, Willem Pieter
  12. Spatial Econometric Analysis Of Urban Expansion According To Residential Density Profile In The District Of Tunis By Ayadi, Mohamed; Ben said, Foued
  13. Determinants of Financial Development across the Mediterranean By Ayadi, Rym; Arbak, Emrah; Ben-Naceur, Sami; De Groen, Willem Pieter
  14. Quantitative Reference Scenario for the MEDPRO Project By Paroussos, Leonidas; Fragkiadakis, Kostas; Charalampidis, Ioannis; Tsani, Stella; Capros, Pantelis
  15. Social Crisis Prevention: A Political Alert Index for the Israel-Palestine Conflict By André De Palma,; Federico Perali; Nathalie Picard; Roberto Ricciuti; Alexandrina Scorbureanu
  16. Croissance de la productivité et réallocations d'emplois au Maroc : la contribution des créations et disparitions d'entreprises By Richard Duhautois; Said El Hamine; Amin El Basri
  17. Access by MSMEs to Finance in the Southern and Eastern Mediterranean: What role for credit guarantee schemes? By Ayadi, Rym; Gadi, Salim

  1. By: Coutinho, Leonor
    Abstract: Despite significant economic reforms in many EU neighbouring countries in the Southern Mediterranean, their growth performance has on average been subdued. This study analyses the differences in growth performance and macroeconomic stability across Mediterranean countries, to draw lessons for the future. The main findings are that Southern Mediterranean countries should benefit from closer ties with the EU that result in higher levels of trade and FDI inflows, once the turbulence of the ‘Arab Spring’ is resolved, and from the development of financial markets and infrastructure. They will also benefit in keeping inflation under control, which will depend in great part on their ability to maintain fiscal discipline and sustainable current accounts. One of the main challenges for the region will be to implement structural reforms that can help them absorb a large pool of unemployed without creating upward risks to inflation.
    Date: 2012–03
  2. By: Baseem Al-Athwari (Technology Management, Economcis, and Policy Program; College of Engineering; Seoul National University); Jorn Altmann (Technology Management, Economcis, and Policy Program; College of Engineering; Seoul National University); Almas Heshmati (Department of Economics, Sogang University)
    Abstract: As information and communication technologies have spread throughout the world, countries have realized the importance of investing more and more in building ICT-relevant infrastructure. However, for fostering further information and communication technology (ICT) development, countries are in need of an analysis tool for measuring their advancement in ICT-relevant infrastructure. Motivated by a variety of attempts to generate measures of ICT development, this study aims to develop an index that quantifies the level of ICT-relevant (e-infrastructure) deployment. In particular, this study introduces two e-infrastructure indices that are composed of six components, namely electricity, telecommunication, Internet, processing power, broadcasting, and human capital. Each component is generated from one or more indicators. This composition provides the possibility of tracking each of them separately and to identify strengths and weaknesses of each country with respect to the ICT-relevant area of the component. It will also help pointing out the source of failure in developing the ICT-related infrastructure and to develop policies for enhancing ICT-related infrastructure accordingly. For the index computation, the study uses a parametric and a non-parametric computation method rather than the traditional approaches which are frequently used in literature. In addition to this, this study also aims at analyzing the indices ranking differences among OECD countries and Middle East & North Africa (MENA) countries, using data for the time period between 2000 and 2007. The ranking of the countries shows that MENA and OECD countries differ significantly in their e-infrastructure development. However, a small group of MENA countries are ranked higher than a few OECD countries. Those countries belong to the Gulf Cooperation Council (GCC).
    Keywords: ICT Infrastructure, Indices, E-readiness, Composite Index, Principle Component Analysis, MENA, OECD.
    JEL: C01 C14 C22 C43 C51 L86 L96 R58
    Date: 2013–04
  3. By: Elasrag, Hussein
    Abstract: Micro, small and medium sized enterprises (M/SMEs) are a dynamic force for sustained economic growth and job creation. They are a valid, crucial component of a vibrant industrial society.M/SMEs stimulate private ownership and entrepreneurial skills; they are flexible and can adapt quickly to changing market demand and supply conditions; they generate employment, help diversify economic activities and make significant contribution to export and trade.Many small projects stalled, especially in light of a great revolution of January 25, 2011. The role of small and medium-sized enterprises in the industrial development of Egypt.
    Keywords: small and medium-sized enterprises , the industrial development , Egypt
    JEL: E02 L0 L6 M2
    Date: 2013–06–01
  4. By: Zubeyir Kilinc; Hatice Gokce Karasoy; Eray Yucel
    Abstract: The composition of bank liabilities has captured a lot of attention especially after the global financial crisis. It is argued that movements particularly in the non-core liabilities may reflect the stage of financial cycle. The literature claims that banks usually fund their credits with core liabilities, which grow with households’ wealth, but when there is a faster growth in credits compared to deposits, the banks resort to non-core liabilities to meet the excess demand. Despite this significant role assumed to be played by the non-core liabilities, there are not too many country-specific studies on this issue. This study analyzes the relationship between the non-core liabilities and credits within a small open economy, namely Turkey. It investigates the relationship under alternative settings and reveals a robust relationship between credits and non-core liabilities under all frameworks. The study also verifies that elevated demand for credit may induce some increase in the non-core liabilities. Finally, the relationship is affirmed in the long-run.
    Keywords: Core Liabilities, Non-core Liabilities, Credits, Small Open Economy, VAR, VECM
    JEL: E44 E51
    Date: 2013
  5. By: Larson, Donald F.
    Abstract: In the Middle East and North Africa, food security and water security are tightly entwined. In particular, choices about the extent to which food security policies rely on trade rather than domestically produced staples have stark consequences for the region's limited water resources. This paper builds on previous modeling results comparing the cost and benefits of policies to protect consumers against surging international wheat prices, and expands the analysis to consider the consequences of the policies for water resources. A self-sufficiency policy is analyzed as well. Results suggest that trade-based food security policies have no significant effect on the sustainability of water resources, while the costs of policies based on self-sufficiency for water resources are high. The analysis also shows that while information about the water footprint of alternative production systems is helpful, a corresponding economic footprint that fully measures the resource cost of water is needed to concisely rank alternative policies in economic terms that are consistent with sustainable outcomes.
    Keywords: Town Water Supply and Sanitation,Food&Beverage Industry,Water and Industry,Water Supply and Sanitation Governance and Institutions,Water Supply and Systems
    Date: 2013–05–01
  6. By: Sekkat, Khalid
    Abstract: This paper investigates the evolution and determinants of manufactured exports and foreign direct investment (FDI) in 11 southern Mediterranean countries over the period 1985–2009 as well as their prospects under different scenarios pertaining to the development of the determinants. The econometric analysis confirms the role of exchange rate depreciation, the openness of the economy and the quality of institutions and infrastructure in fostering manufactured exports and FDI inflows in the region. The assessment of the prospects suggests that a scenario of deeper integration with the EU entails superior performance for manufactured exports and FDI compared with either the status quo or less integration with the EU but greater integration within the region.
    Date: 2012–04
  7. By: Mohammed Amine Balambo (CRETLOG - Centre de Recherche sur le Transport et la LOGistique - Université de la Méditerranée - Aix-Marseille II : EA)
    Abstract: Cette communication a pour objectif de comprendre l'influence que pourrait avoir la culture nationale d'un pays sur la nature de la confiance inter organisationnelle développée entre partenaires impliqués dans une supply chain. Cette étude se fondera sur un mode de raisonnement hypothético-déductif qui permettra de faire émerger un modèle théorique explicatif qui fera l'objet de deux enquêtes empiriques. La première est une étude qualitative à des fins exploratoires visant la contextualisation du modèle, puis une étude quantitative davantage confirmatoire fondée sur la méthode par les équations structurelles sous l'approche PLS (Past Least Squares).
    Date: 2013
  8. By: Ayadi, Rym
    Abstract: This MEDPRO Policy Paper examines the trends and prospects in financial-sector development and integration in the southern and eastern Mediterranean countries and concludes with an agenda for a long-term sustainable transition where finance turns to be a positive stimulus to long-term growth.
    Date: 2013–04
  9. By: Ayadi, Rym; Arbak, Emrah; De Groen, Willem Pieter
    Abstract: This analysis of regulatory convergence shows that substantial improvements have been made in the southern and eastern Mediterranean countries (SEMCs), yet they still suffer from key weaknesses in deposit insurance, entry obstacles, political interference and the strength of legal rights. In particular, deposit insurance systems in many SEMCs are not explicit, which could lead to uncertainties in the provision of support to banks in case of default. Moreover, most systems do not attempt to align the banks’ incentives in risk-taking with those of taxpayers by implementing risk-based premiums. Another persistent issue is the presence of entry obstacles, with signs of substantial barriers to entry and continued government ownership of banks. The comparison of regulatory systems also highlights that some SEMCs have barely been able to catch up with the strong increase in supervisory independence in EU Mediterranean countries in recent years. While creditor protection remains relatively weak, significant improvements in credit information have occurred since 2003, notably through the establishment of private credit bureaus with universal coverage.
    Date: 2013–03
  10. By: Ayadi, Rym; Arbak, Emrah; Ben-Naceur, Sami; De Groen, Willem Pieter
    Abstract: This MEDPRO Technical Report explores the relationship between financial sector development and economic growth, using a sample of northern and southern Mediterranean countries for the years 1985-2009. The authors included several variables to measure the development of the financial sector to account both for quantity and quality effects. The results indicate that credit to the private sector and bank deposits are negatively associated with growth, which confirms deficiencies in credit allocation in the region and suggests weak financial regulation and supervision. On the stock market side, the results seem to indicate that stock market size and liquidity play a significant role in growth, especially when accounting for the quality of an institution. Investment, whether domestic or in the form of FDI, contributes significantly to economic growth. Stronger institutions and low inflation are key growth factors. Initial GDP has a persistently and significantly negative impact on growth, which implies that poorer countries are catching up richer countries in terms of economic growth.
    Date: 2013–03
  11. By: Ayadi, Rym; Arbak, Emrah; Ben-Naceur, Sami; De Groen, Willem Pieter
    Abstract: This paper aims at devising scenarios for the development of the financial system in the southern and eastern Mediterranean countries (SEMCs), for the 2030 horizon. The results of the simulations indicate that bank credit to the private sector, meta-efficiency and stock market turnover could reach at best 108%, 78% and 121%, respectively, if the SEMCs adopt the best practices in Europe. These scenarios are much higher than those of the present levels in the region but still lower than the best performers in Europe. More specifically, we find that improving the quality of institutions, increasing per capita GDP, opening further capital account and lowering inflation are needed to enable the financial system in the region to converge with those of Europe.
    Date: 2013–03
  12. By: Ayadi, Mohamed; Ben said, Foued
    Abstract: Urban expansion of the city of Tunis, source of distortion of inter-zones balance between housing supply and employment, does only increase daily mobility and increases pressure on public transportation in terms of traffic, on transportation infrastructure in terms of congestion and on the environment in terms of pollution. This study tried to detect urban expansion patterns through estimating the gradient of a population density function in relation to distance from the center, whose shape is inspired by the standard models of the urban economy. Negative and significant signs of density gradients for the periods 1984, 1994 and 2004 indicate that the city of Tunis is more compact around its centre, and knows an exceptional expansion of its peripheries. A deeper analysis of density using spline regression techniques showed that the city can be divided into three rings, a central ring characterized by lower density gradient synonymous with progressive urban expansion, a ring containing the suburbs marked by a compact dynamic in the first decade slowed down in the second decade, and a suburban ring characterized by a progressive compacting process around classic suburban centres.
    Keywords: Tunis, Urban Expansion, Population Density, Residential Density, Urban Dynamics.
    JEL: J10 R12 R14 R23
    Date: 2012
  13. By: Ayadi, Rym; Arbak, Emrah; Ben-Naceur, Sami; De Groen, Willem Pieter
    Abstract: Casual observation shows that that the financial systems in the southern and eastern Mediterranean are unable (or unwilling) to divert the financial resources that are available to them as funding opportunities to private enterprises. Using a sample of northern and southern Mediterranean countries for the years 1985 to 2009, this study empirically assesses the reasons underlying such conditions. The results show that strong legal institutions, good democratic governance and adequate implementation of financial reforms can have a substantial positive impact on financial development only when they are present collectively. Moreover, inflation appears to undermine banking development, but less so when the capital account is open. Government debt growth appears to weaken credit growth, which confirms that public debt ‘crowds out’ private debt. Lastly, capital inflows appear to primarily have an income effect, increasing income and thereby national savings, and thus increasing the availability of credit.
    Date: 2013–02
  14. By: Paroussos, Leonidas; Fragkiadakis, Kostas; Charalampidis, Ioannis; Tsani, Stella; Capros, Pantelis
    Abstract: In general equilibrium models the reference scenario is important, as the evaluation of the alternative policies modelled is based on their deviation from the reference scenario. The reference scenario relates to the development of an economic outlook for each region and sector of the model. This means that assumptions are made about the main drivers of growth, e.g. population growth and technical progress. This report provides the main assumptions used for the development of the reference scenario in the MEDPRO project. The report also provides a brief country and sectoral overview for each of the southern and eastern Mediterranean countries covered by the MEDPRO project.
    Date: 2013–05
  15. By: André De Palma,; Federico Perali; Nathalie Picard; Roberto Ricciuti; Alexandrina Scorbureanu (Ecole Normale Supérieure de Cachan; University of Verona and CHILD; Universite de Cergy-Pontoise; University of Verona and CESifo; University of Verona)
    Abstract: This study presents a novel approach to crisis prevention based on data on premonitory political and religious events and the international media coverage of publicly sensitive circumstances. We implement our method to the Israel-Palestine conflict. First we identify two main political scenarios associated with "good" and "bad" political times of low or high levels of political unrest using a hierarchical clustering technique. Then we construct a political alert index to predict the probability of occurrence of good and bad times. Bad times are positively and significantly associated with the number of Israeli victims at the checkpoints, the number of homeless or injured Palestinians and with the number of demolitions. The number of Palestinian prisoners and injured Israelis negatively affect the probability of occurrence of a bad time. Media coverage is positively and significantly associated with the transition to bad times. Our results show that our statistical tool can be a reliable method for early warning of social crisis and can be effectively replicated to other social crisis situations.
    Keywords: crisis prevention, alert index, news, Israel, Palestine
    JEL: D74 F51 P48
    Date: 2013
  16. By: Richard Duhautois (CEE - Centre d'études de l'emploi - Ministère de l'Enseignement supérieur et Recherche - Ministère du Travail, de l'Emploi et de la Santé, ERUDITE - Equipe de Recherche sur l'Utilisation des Données Individuelles Temporelles en Economie - Université Paris-Est Créteil Val-de-Marne (UPEC) : EA437 - Université Paris-Est Marne-la-Vallée (UPEMLV)); Said El Hamine (CEE - Centre d'études de l'emploi - Ministère de l'Enseignement supérieur et Recherche - Ministère du Travail, de l'Emploi et de la Santé); Amin El Basri (CEE - Centre d'études de l'emploi - Ministère de l'Enseignement supérieur et Recherche - Ministère du Travail, de l'Emploi et de la Santé)
    Abstract: Dans cet article, nous nous proposons d'identifier les différents types d'entreprises (entreprises pérennes, entreprises apparues ou disparues) qui contribuent à la croissance de la productivité du travail et de la productivité globale des facteurs (PGF) dans l'industrie marocaine. Nous utilisons deux méthodes de décomposition (Griliches, Regev [1995] ; Foster, Haltiwanger et Krizan [1998]) qui permettent de prendre en compte le processus de destruction créatrice - le renouvellement des entreprises - et la croissance des entreprises pérennes. Ensuite, nous mettons la croissance de la productivité en relation avec les réallocations d'emplois, c'est-à-dire avec les créations et les destructions brutes d'emplois. La période étudiée est divisée en deux : 1990-1995 et 1995-2000. En outre, nous distinguons les dynamiques sectorielles (au sein de l'industrie), car les effets de recomposition de l'économie marocaine ont des conséquences à la fois sur la productivité et l'emploi. Nous montrons, dans un premier temps, que la croissance de la productivité du travail est fortement dépendante de la croissance au sein des entreprises pérennes ; dans un second temps, que, pour la croissance de la productivité globale des facteurs, les entrées jouent un rôle plus important, notamment en incorporant du capital plus performant ; enfin, que les disparitions d'entreprises expliquent la différence de croissance de l'emploi entre les deux périodes de la décennie 90.
    Date: 2013–06–07
  17. By: Ayadi, Rym; Gadi, Salim
    Abstract: Micro-, small- and medium-sized enterprises (MSMEs) in the Southern and Eastern Mediterranean suffer from credit constraints. Given their contribution to employment and growth, similarly as in other regions, policy-makers have developed credit guarantee schemes (CGSs) in order to facilitate small companies’ access to debt capital. CGSs are risk-sharing mechanisms under which a guarantor ensures the lender against a share of the possible losses it incurs when extending a loan. Despite the maturity of some schemes, knowledge of the schemes’ functioning, operating environment as well as performance in guaranteeing loans for MSMEs is scarce. Building on a previous study of CGSs in the region, this paper extends the available knowledge on the region’s schemes, building on the results of an exclusive questionnaire to gain insights into these mechanisms. First, the paper reviews the conditions of MSMEs’ access to finance in the Southern and Eastern Mediterranean; second, it presents the results of the questionnaire across a number of dimensions ranging from ownership to financial performance; and third, the paper presents some avenues for future policy research in this area.
    Date: 2013–04

This nep-ara issue is ©2013 by Quentin Wodon. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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