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on MENA - Middle East and North Africa |
| By: | Abdelaaziz Ait Ali; Yassine Msadfa |
| Abstract: | Morocco, Tunisia and Egypt (such as many other developing countries) have always considered pro-active industrial policies as an important means to upgrading their manufacturing sector. In an era of premature deindustrialization, the manufacturing sector is expected to promote structural change and economic convergence allowing job creation. On this basis, this paper thus analyzes the pace of structural transformation for the three North African countries in the last decade using two approaches. First, this study analyzes labor reallocation between five sectors of the economy and assess to what extent this movement contributes to the overall productivity growth. The second approach applied in this study is related to the construction of new measures for exports performance, quality and variety dimensions. Results show that for the case of Morocco and Tunisia, performances are comparable with a reallocation effect that was positive and contributed to 18% and 21% respectively to overall productivity growth, driven mainly by services that were able to create more and more employment in parallel with an increase in their efficiency as measured by productivity gains. However, Morocco has witnessed a productivity growth around 3.7% per year in average while in Tunisia the performance is well below, rounding up to 1.7%. For Egypt, the period 1999-2008 experienced a negative contribution of the reallocation effect to overall productivity growth, meaning that the labor factor was moving from high productivity sectors to low productivity sectors. Horizontal policies related to exchange rate management and monetary policy could be the factors to blame for this growth-reducing structural change. In addition, the increased reliance on natural resources could have compromised the reallocation of labor between low to high productivity sectors. For the quality index, it seems that not much improvement has been noted in the 2000s for the three countries, even for industries targeted by the policy makers in each country. For the variety index, the overall performance of the three countries has improved steadily in the last decade, but driven mainly by classic sectors such as textile or food and tobacco. The manufacturing sector in general in these countries has known a shrinking contribution to wealth and employment creation. The deindustrialization process could be overcome through increased integration in global value chains (GVC). Taking full advantage of the changing landscape of the production systems and networks may allow North African countries to accelerate their structural change and enhance their manufacturing sector. These countries are increasing in fact their participation in the GVCs. The challenge for each economy in this case is the capacity to upgrade and climb up the GVC ladder from low value added to high value added activities. At a starting point, it could be enough for a country to integrate the GVC in low value added activities, which is apparently the case for these countries, but beyond a certain level, these economies must aim to climb the GVCs ladder and move away from low value added activities. Describing the right ingredients for any industrial policy is, in the authors’ point of view, the best way to deceive, but economists agree on the importance of upgrading the logistics and infrastructure framework, which are relevant to keep the economy competitive and highly anchored to international markets. In addition, a success in climbing the GVC ladder is contingent on capacity to ensure the supply of skilled labor to leverage the challenge and move the economy to high value added activities. Active interventions in selective sectors is not enough to build a strong manufacturing sector and a competitive economy. A “policy mix” between vertical and horizontal policies is to be kept in mind. Maintaining a sound macroeconomic framework is also crucial, especially regarding monetary policy decisions, exchange rate movements and the fiscal policy stance. |
| Date: | 2016–04 |
| URL: | http://d.repec.org/n?u=RePEc:ocp:rpaper:pp-16/04&r=ara |
| By: | Malit, Jr., Froilan T. (Cornell University); Naufal, George S (Texas A&M University) |
| Abstract: | This paper examines the legal and policy implications of information asymmetry on foreign domestic workers employed under the Kafala sponsorship system in the Gulf Cooperation Council (GCC) countries. Drawing from ethnographic and field-based observations in large GCC migrant destinations – including Kuwait, Qatar, and the United Arab Emirates (UAE) – we investigate the information flows and market uncertainties between five key stakeholders: labor-receiving governments, labor-sending governments, recruitment agencies (subagents), sponsors (employers), and social networks. Several factors contribute to asymmetric information: the lack of bilateral labor agreements and government policy coordination, programs between and among government entities, the absence of labor law for domestic workers, and the laissez faire approach of the labor-receiving government. These sources of asymmetric information create serious market vulnerabilities for the domestic worker population, often resulting in loss of employment and early deportation. The concluding section further outlines policy implications and areas of methodological research on GCC migration. |
| Keywords: | asymmetric information, migration, domestic worker, Middle East, Gulf Cooperation Council Countries |
| JEL: | D82 F22 G14 N35 N45 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9941&r=ara |
| By: | Bulut, Mustafa; Karasoy, Hatice Gökçe |
| Abstract: | This study analyzes the transmission of monetary policy decisions to financial markets under varying levels of monetary policy uncertainty. We conducted an event study for the period June 2010-January 2015. The uncertainty regarding to monetary policy is measured by the disagreement of expectations in the CBRT Survey of Expectations. Empirical findings indicate that the effectiveness of monetary transmission mechanism is highly affected by policy uncertainty. For example, a positive policy surprise leads to an appreciation of Turkish lira against US dollar under low levels of uncertainty, whereas Turkish lira depreciates when uncertainty is high. Furthermore, an increase in the main policy rate flattens the yield curve for all uncertainty levels. On the other hand, this pattern is more pronounced while uncertainty is low and contrary to expectations, long term rates decreases after a positive policy surprise. During the periods when uncertainty regarding monetary policy is low, positive policy surprise decreases long term rates via anchoring inflation expectations. |
| Keywords: | Monetary Policy, Financial Markets, Uncertainty, Event Study. |
| JEL: | D80 E58 G14 |
| Date: | 2016–05–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:71215&r=ara |
| By: | International Monetary Fund |
| Abstract: | The oil price shock has hit Algeria’s economy hard and exposed the longstanding vulnerabilities of a growth model dependent on hydrocarbon and public spending. The fiscal position—already weakened by a ramp-up in spending in the wake of the Arab Spring—has deteriorated further as oil revenues plummeted. Once-substantial fiscal savings have been nearly depleted to finance large budget deficits. Following several years of comfortable surpluses, the current account balance has swung sharply into deficit and official reserves, while still large, are diminishing. The banking system as a whole appears healthy, but financial stability risks are increasing. The policy response in 2015 was insufficient, but the 2016 budget calls for a sharp reduction in spending, and the authorities have initiated some reforms, including a much needed reform of the subsidy system. |
| Keywords: | Article IV consultation reports;External shocks;Oil prices;Fiscal consolidation;Fiscal reforms;Monetary policy;Banking sector;Economic indicators;Balance of payments statistics;Debt sustainability analysis;Staff Reports;Press releases;Algeria; |
| Date: | 2016–05–18 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfscr:16/127&r=ara |
| By: | Muge Akyildiz Munusturlar (Anadolu University) |
| Abstract: | The aim of the study is to present the results of a study examining the different ways of experiencing the leisure meanings of the undergraduate students studying in a state University in Turkey. Leisure Meanings Inventory (LMI) was used to collect data which was developed by Schulz and Watkins (2007). The first part was comprised of 23 statements related to meanings of leisure. These meanings of leisure included four dimensions which were passing time, exercising choice, escaping pressure, and achieving fulfillment. In the second part of the questionnaire, students were asked to indicate their demographic characteristics (age, gender, education level). A total of 300 questionnaires were distributed, 265 of which were completely answered, resulting in a return rate of 88 percent. According to the results, the sample profile indicates the gender of respondents is dominated by females (52%) and 40% were aged between 21-22 years old. The results of the study revealed that 34% of the participants were freshmen; 22% of them were sophomore and about 21% of the participants were junior, and about 22% of the participants were senior. It was also revealed that the most experienced meaning of leisure was escaping pressure (Mean=4.00; SD=0.91). Passing time (Mean: 3.98; SD=1.01) had the second highest mean scores whereas achieving fulfillment (Mean: 3.89; SD=0.91) and exercising choice (Mean: 3.81; SD=1.01) had the lowest mean scores in regard to experienced meaning of leisure by the undergraduate students. Overall, when all meanings of leisure are evaluated together, escaping pressure and stresses of daily life come to the fore as the most experienced way of leisure. |
| Keywords: | leisure, experience, leisure meanings, undergraduate students |
| URL: | http://d.repec.org/n?u=RePEc:sek:iacpro:3606155&r=ara |
| By: | Demdoumi, Meriem |
| Abstract: | During these last years, Morocco has almost always known at the same time a budget deficit and a current account deficit. So we can conclude prematurely the existence of a structural problem of twin deficits over a long period. The article introduces in addition to the two balances, the variable transfers of MREs - second source of foreign currency after the tourist returns - as a participatory variable to the equilibrium of the current transactions and verify the hypothesis of the twin deficits using econometric tools, notably the method of Co-integration - to test the long-term relationship - and the method of Granger causality - to know the direction of causality -. The results confirm the twin deficits hypothesis for Morocco for the period from 1980 to 2014 and show bidirectional causality between the variables and the lack of a balanced strategy. |
| Keywords: | Twin deficit, Transfers of MREs, Co-integration, Granger causality, Balanced strategy. |
| JEL: | H00 H60 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:71533&r=ara |