nep-ara New Economics Papers
on MENA - Middle East and North Africa
Issue of 2017‒06‒18
seven papers chosen by
Paul Makdissi
Université d’Ottawa

  1. The Regional Impact of Trade Liberalization on Households in Egypt, 1999-2012 By Jérémie Gignoux; Akiko Suwa-Eisenmann
  2. The Impact of the Fracking Boom on Arab Oil Producers By Lutz Kilian
  3. Algeria; 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Algeria By International Monetary Fund
  4. Algeria; Selected Issues By International Monetary Fund
  6. Multi-Country Report; Ensuring Financial Stability in Countries with Islamic Banking-Case Studies-Press Release; Staff Report By International Monetary Fund
  7. Transferts de fonds des migrants vers les pays du Maghreb : quel impact sur le taux de change effectif réel ? By Nader Nefzi; Joel Oudinet; Mouez Soussi

  1. By: Jérémie Gignoux (PSE-INRA, France); Akiko Suwa-Eisenmann
    Abstract: This paper assesses the impact of trade liberalization in Egypt by comparing regions more exposed to trade opening compared to regions that were less exposed. As each region in Egypt (that we define as the urban or the rural part of a governorate) specializes in different production sectors, and tariff reduction varies by sector, the impact of trade liberalization on households depends on the region they live in and the sector they source their income from. This approach is relevant in the case of Egypt, as geographical mobility across regions is small. We find that trade liberalization in Egypt at a fast pace between 1999 and 2004 has been detrimental to households, while the subsequent liberalization between 2004 and 2012 had more limited effects. Poverty has declined in Egypt but less so in regions more exposed to tariff reduction. In the latter, household income has also been reduced, especially self-employment income and wages. Unskilled wages were the most affected but less so after 2004, a possible effect of labor reform in 2003. While activity and employment rates increased on average over the period, they did significantly more for skilled individuals in regions that were more protected by trade policy.
    Date: 2017–06–15
  2. By: Lutz Kilian (Department of Economics, University of Michigan)
    Abstract: This paper makes four contributions. First, it investigates the extent to which the U.S. fracking boom has caused Arab oil exports to decline since late 2008. Second, the paper quantifies for the first time by how much the U.S. fracking boom has lowered the global price of oil. Using a novel econometric methodology, it is shown that in mid-2014, for example, the Brent price of crude oil was lower by $10 than it would have been in the absence of the fracking boom. Third, the paper provides evidence that the decline in Saudi net foreign assets between mid-2014 and August 2015 would have been reduced by 27% in the absence of the fracking boom. Finally, the paper discusses the policy choices faced by Saudi Arabia and other Arab oil producers.
    Date: 2017–06–22
  3. By: International Monetary Fund
    Abstract: Algeria continues to deal with the implications of lower oil prices for an economy that is highly dependent on hydrocarbons. Lower hydrocarbon revenues have led to large current account and fiscal deficits, a steep decline in international reserves (although they remain high), and a near depletion of fiscal savings in the oil stabilization fund. After a timid start, reform momentum is building. Last year, the authorities achieved a sizeable reduction in the fiscal deficit. They have adopted, for the first time, a medium-term budget framework that envisages ambitious fiscal consolidation. They have implemented some structural reforms and are working on a long-term strategy to reshape the country’s growth model. The central bank is adapting to changing liquidity conditions by reintroducing refinancing instruments.
    Date: 2017–06–01
  4. By: International Monetary Fund
    Abstract: Algeria: Selected Issues
    Date: 2017–06–01
  5. By: Ahmet F. Aysan; Mustafa Disli; Huseyin Ozturk (-)
    Abstract: We examine the interest rate sensitivity of both deposits and credits at Islamic and con- ventional banks in Turkey. We find that the bank lending channel is especially operative for Islamic banks. Impulse responses for conventional and Islamic banks reveal that Islamic bank depositors’ sensitivity to policy rate changes are substantially larger than that of con- ventional bank depositors. Next to heavily dependence on deposit funding, we consider that inertia in Islamic bank deposit rates impedes these banks to keep those depositors who con- sider the opportunity cost of monetary policy rates is unbearable. At the lending side, we obtain similar results, implying that tight monetary policy leads to a larger contraction in Islamic bank credits. This finding is a reflection of the favorable attitude of Islamic banks towards SME financing. When similar relationships are analysed for currency and inflation shocks, we again find larger responses for Islamic banks showing the cyclical nature of SME credits.
    Keywords: Lending channel, Monetary transmission, Islamic banks, SMEs
    JEL: E44 E51 E52 G21
    Date: 2017–05
  6. By: International Monetary Fund
    Abstract: This background paper, which is a supplement to the board paper on “Ensuring Financial Stability in Countries with Islamic Banking (IB) Sectors”, presents country experiences with reforms to strengthen regulatory oversight of the IB sector. It reviews experiences with and the progress made in adapting prudential, safety nets and resolution frameworks to the specifics of IB. The selection of several countries from a range of regions with different levels of development and approaches to IB was designed to provide a representative sample of country experiences so as to enrich the policy conclusions. Such a multiplicity of experiences can help to identify common challenges that countries face in reforming their regulatory frameworks and to distill best practices. The countries, for which detailed case studies have been undertaken, are: Bahrain, Djibouti, Indonesia, Kenya, Kuwait, Malaysia, Nigeria, Pakistan, Sudan, Turkey and the United Kingdom.
  7. By: Nader Nefzi (Centre d'Economie de l'Université de Paris Nord (CEPN)); Joel Oudinet (Centre d'Economie de l'Université de Paris Nord (CEPN)); Mouez Soussi (PS2D, Institut de Hautes Etudes Commerciales Carthage)
    Abstract: L’impact des transferts de fonds sur le taux de change effectif réel est analysé pour un panel de trois pays du Maghreb, la Tunisie, le Maroc et l’Algérie entre 1980 et 2015, à l’aide d’un modèle en panel dynamique autorégressif à retards échelonnés (ARDL) qui permet d’analyser aussi bien la relation de court et de long terme. Les résultats montrent, contrairement à ce qui est trouvé pour les pays d’Amérique latine, que l'afflux de capitaux sous forme de transferts de fonds par les migrants entraîne, non pas une appréciation, mais une très légère dépréciation du taux de change effectif réel. En conséquence, les envois de fonds par leur impact sur le taux de change n'ont pas d'incidence négative sur la compétitivité prix des trois pays du Maghreb. Cet effet est légèrement plus marqué en Algérie qu’en Tunisie ou au Maroc. L’usage des transferts par les familles récipiendaires, les caractéristiques contra cycliques des entrées de devise, via les transferts des migrants et la politique de change menée réduisent ce risque d’appréciation du change, nommé « syndrome hollandais ».
    Keywords: Migration, Envois d’argent, taux de change effectif réel, Dutch Disease, syndrome hollandais, Algérie, Maroc, Tunisie
    JEL: F22 F24 F31
    Date: 2017–03

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