nep-ara New Economics Papers
on MENA - Middle East and North Africa
Issue of 2015‒01‒14
eleven papers chosen by
Paul Makdissi
Université d’Ottawa

  1. Aviation liberalisation as a means of promoting international tourism: Comparing Morocco and Tunisia By Frédéric Dobruszkes; Aymen Ghedira
  2. Turkey: Selected Issues Paper By International Monetary Fund. European Dept.
  3. The origin of stock market volatility --- the case of Indonesia and Turkey By Harald Schmidbauer; Narod Erkol
  4. What is so specific with Middle-East and North-African pattern of growth and structural change? A quantitative comparative analysis By Dalila NICET-CHENAF; Eric ROUGIER
  5. Source and host country volatility and FDI : A gravity analysis of European investment to Middle East and North Africa By Dalila Nicet-Chenaf; Eric Rougier
  6. Jordan: Fifth Review Under the Stand-By Arrangement, Request for Waivers of Nonobservance of Performance Criterion and Applicability of Performance Criterion, Modification of Performance Criterion, and Rephasing of Access-Staff Report; Press Release; and Statement by the Executive Director for Jordan By International Monetary Fund. Middle East and Central Asia Dept.
  7. Working Paper - 215 - A Regional Budget Development Allocation Formula for Tunisia By AfDB AfDB
  8. Labour demand and social dialogue two binding constraints for decent work for youth in the Arab region By Tzannatos, Zafiris
  9. Financial Development and Inclusive Growth : Attaining Shared and Sustainable Prosperity in Egypt By World Bank
  10. Algeria: 2014 Article IV Consultation-Staff Report; Press Release; and Statement by the Executive Director for Algeria By International Monetary Fund. Middle East and Central Asia Dept.
  11. Cortiça em Marrocos. A excursão florestal de Octavio Elorriera em 1933 By Ignacio García Pereda

  1. By: Frédéric Dobruszkes; Aymen Ghedira
    Date: 2014
  2. By: International Monetary Fund. European Dept.
    Keywords: Monetary policy;Banking sector;Foreign exchange reserves;Inflation targeting;Current account deficits;Savings;Macroprudential Policy;Selected Issues Papers;Turkey;
    Date: 2014–12–05
  3. By: Harald Schmidbauer; Narod Erkol
    Abstract: One of the advantages to analyze the economic links between two countries on the basis of stock market data, rather than aggregate economic data published by national statistical offices, is that stock market data are readily available, allowing analysis in almost real time. We consider a directed network with equity markets as nodes and return-to-volatility spillovers, obtained via forecast error variance decomposition (fevd), indicating the weights of the edges. In the course of globalization, it can be generally observed that the share of volatility originating from outside a local stock market has been gradually decreasing. This is also the case for Indonesia and Turkey. We show that the link of Indonesia to Turkey has recently become more important, that is, spillovers from the Indonesian to the Turkish stock market have increased, but not in the opposite direction. Using notions related to network centrality and information entropy, we also identify political and economic events having a big impact on the distribution of stock market volatility in Indonesia and Turkey.
    Keywords: Indonesia, Turkey (and other stock markets), Finance, Developing countries
    Date: 2014–07–03
  4. By: Dalila NICET-CHENAF; Eric ROUGIER
    Abstract: This paper quantitatively compares Middle East and North African (MENA) countries’ growth patterns with those of a sample of middle-income countries. Three complementary sets of growth determinants are tested: accumulation, institutions and structural change. After having estimated the model on a sample of middle income countries, our comparative analysis shows that MENA economies sharply contrast with other middle income emerging economies with respect to two main dimensions: (1) the sectoral structure of production and (2) the institutional environment. The assumption of complementary effect of the accumulation, institutional and structural growth determinants is also tested. We show that the MENA pattern of growth exhibits structural weaknesses, like the combination of a low pace of structural change and high corruption levels, which may have hindered the expansion of highly productive job, and possibly bred massive discontent in the region.
    Keywords: Economic growth; Structural change; Institutions; Corruption; Middle-East and North-Africa; Middle-income economies; Quantitative comparative analysis; Panel data; GMM estimation
    JEL: O4 J2
    Date: 2014
  5. By: Dalila Nicet-Chenaf (Larefi, Université de Bordeaux); Eric Rougier (Gretha, Université de Bordeaux)
    Abstract: Macroeconomic determinants of FDI are seldom analyzed from the perspective of source countries, priority being generally given to host country characteristics. In a gravity set-up, we analyze FDI flows from European Union to MENA economies. We find that European investment to our MENA host countries is higher, the lower the source country output volatility, thereby supporting the existence of an income effect for European Transnational corporations. In the case of MENA economies, source country output volatility's adverse impact on FDI is counterbalanced by the positive attraction effect of domestic swings of activity. We also find that 1995's Barcelona agreement has reinforced MENA countries' vulnerability to European short- and medium-term macroeconomic cycles. The emergence of non-traditional sources of European FDI is, however, a positive evolution since Eastern and Central European investment to MENA countries is less sensitive to host and source country macroeconomic volatility that traditional Western and southern European sources tend to be. Our results are robust to various changes in estimator, sample composition or measurement of instability.
    Keywords: Output volatility, Inflation, FDI, gravity model, source countries, European Union, MENA
    JEL: F21 F43 F44
    Date: 2014–05
  6. By: International Monetary Fund. Middle East and Central Asia Dept.
    Abstract: EXECUTIVE SUMMARY Jordan’s economy has been resilient in an increasingly difficult regional environment. Previously highlighted risks have materialized, most notably major disruptions of gas flows from Egypt, and new ones have emerged, particularly from the conflict in Iraq. The macroeconomic situation, however, has remained largely stable, with a narrowing current account and international reserves remaining at a comfortable level. Program performance in 2014 is broadly on track. The end-September performance criterion (PC) on the central government primary deficit is estimated to have been met, but the PC on the combined public sector deficit is likely to have been missed owing to a shortfall in gas flows from Egypt. International reserves continued to over-perform through September. All PCs for the remainder of the year are expected to be met with the exception of a higher combined deficit from the gas shortfalls (0.7 percent of GDP compared with the program), which is financed by grants. Further fiscal consolidation will take place in 2015, but stronger tax reform is called for. Continued adjustment will move debt onto the programmed downward trend, while new grants will cover higher electricity company NEPCO losses owing to lower Egyptian gas supply (1.4 percent of GDP higher compared with the program). Most of the central government adjustment is on the expenditure side. Parliament approval of an income tax law is expected by year-end, but further tax reform is paramount. Losses of NEPCO will start declining in 2015, reflecting a tariff increase planned for January and the liquefied natural gas terminal becoming operational in mid-year. Despite some positive steps in structural reforms, more is needed to generate jobs. Progress has been made in facilitating investment, broadening access to finance, and improving transparency. But labor market reform warrants more attention in order to address structurally high unemployment. There is also scope to upgrade public financial management and modernize the tax administration. Vision 2025—a government strategy document under discussion—is an opportunity to focus more on these issues. Mounting risks underscore that continued grants are vital for the coming years. Grants are already helping, but continued support is needed, including for hosting the Syrian refugees. The completion of the fifth review makes available SDR 82.25 million (about $129 million).
    Keywords: Stand-by arrangement reviews;Fiscal reforms;Tax reforms;Bank supervision;Staff Reports;Press releases;Phasing of purchases;Performance criteria modifications;Performance criteria waivers;Jordan;
    Date: 2014–12–02
  7. By: AfDB AfDB
    Date: 2014–12–30
  8. By: Tzannatos, Zafiris
    Keywords: decent work, youth employment, labour demand, social dialogue, employment policy, labour migration, Arab countries, travail décent, emploi des jeunes, besoins en main-d'oeuvre, dialogue social, politique de l'emploi, migrations de main-d'oeuvre, pays arabes, trabajo decente, empleo de jóvenes, necesidad de mano de obra, diálogo social, política de empleo, migraciones laborales, países arabes
    Date: 2014
  9. By: World Bank
    Keywords: Finance and Financial Sector Development - Access to Finance Banks ; Banking Reform Private Sector Development - Emerging Markets Finance and Financial Sector Development - Bankruptcy and Resolution of Financial Distress Finance and Financial Sector Development - Debt Markets
    Date: 2014
  10. By: International Monetary Fund. Middle East and Central Asia Dept.
    Abstract: KEY ISSUES Inflation has subsided, but longstanding vulnerabilities are becoming increasingly apparent. Economic growth is holding up well, inflation has fallen below the central bank’s target, and fiscal and external buffers remain large. But the economy’s dependence on the hydrocarbon sector has led to serious vulnerabilities that are now coming to light. Stagnating hydrocarbon production and declining oil prices, combined with increasing domestic consumption of hydrocarbon products, are depressing export receipts. Public spending continues to increase, fueling imports and a loss of competitiveness, and placing fiscal policy on an increasingly unsustainable path. As a result, the current account is expected to record a deficit in 2014 for the first time in more than 15 years. Unemployment remains high among youth and women. Algeria needs to consolidate macroeconomic and financial stability. A full-fledged fiscal rule, combined with an ambitious consolidation effort over the medium term, would help put the fiscal stance on a sustainable path. The decline in inflation experienced since the 2012 is a positive outcome that needs to be maintained through continued efforts to absorb liquidity and a more active use of interest rates. The exchange rate policy should avoid deviations of the dinar from its equilibrium level, and should support the deepening of forex markets. The implementation of FSAP recommendations should be pursued, notably to strengthen financial sector stability. An export-oriented strategy is needed to ensure external sustainability. Export diversification is imperative to ensure external sustainability and reduce vulnerability to fluctuating oil prices. Diversification policies should focus on maintaining economic stability and improving competitiveness, increasing openness to trade and capital flows, (particularly FDI), and creating a more export-friendly business climate. Additional reforms are needed to increase hydrocarbon exports, including reforms to increase production and phase-out implicit subsidies on energy and electricity, which are fueling domestic consumption. Algeria’s significant growth potential needs to be more fully realized. Reforms are needed to reduce the dominance of the public sector and transform the private sector into an engine for growth, supported by a deeper financial sector. To increase employment, Algeria will need better-functioning labor markets, a workforce equipped with more relevant skills, and more effective labor market programs. Exchange rate regime. The de facto exchange rate regime is classified as “other managed arrangement.” Algeria has accepted the obligations of Article VIII Sections 2(a), 3, and 4.
    Keywords: Article IV consultation reports;Economic growth;Fiscal policy;Fiscal reforms;Labor market reforms;Monetary policy;Economic indicators;Debt sustainability analysis;Staff Reports;Press releases;Algeria;
    Date: 2014–12–11
  11. By: Ignacio García Pereda
    Abstract: This work uses information available in forest reviews and some Spanish Archives to describe the works made by the Spanish and French forest engineers, in Morocco, in the 1930s. In the colonizing efforts of the Spanish government the foresters provided an essential expertise. The forestry activities deal with cartography, forest management, taxonomic and economic botany and a host of related matters. A visit of the forester Elorrieta, who wrote a chronicle of the trip in the review Montes e Industrias, let us to make a description of the forest works in the cork-oak forests of Morocco.
    Keywords: Octavio Elorrieta, foresters, Morocco, Cork-oak forests, cork
    JEL: A22 N57 O13 O14 Q23
    Date: 2014–12

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