Analysts forecast a tepid year-on-year GDP increase this 2024, ranging from 2.4 to 2.7 percent
It’s almost halfway through the year, and various economic forecasts released in the past months point to a shared sentiment: the Middle East and North Africa (MENA) region is facing a modest expansion amid persistent challenges.
In April, the International Monetary Fund (IMF) shared its regional forecast, indicating that MENA’s gross domestic product (GDP) could grow by 2.7 percent this year. This is a slight bump from last year’s 1.9 percent. The IMF said this could accelerate to 4.2 percent in 2025. This expansion comes at a time of various concerns: ongoing conflicts, reduced oil supply, and trade disruptions, among others.
A May report by Focus Economics aligns with these views, showing a GDP increase of 2.4 percent for 2024 in the MENA region. A rise to 3.8 percent is anticipated in 2025 as OPEC+ relaxes production restrictions. Notably, Saudi Arabia is expected to achieve a growth rate of 2.2 percent in 2024, improving to 4.7 percent in 2025. This comes as the oil giant is aggressively continuing its mission to diversify its economy, helmed by its ambitious Vision 2030 plan.
Egypt — part of the Arab world’s “Big Three” economies alongside the UAE and Saudi Arabia — is projected to have a GDP growth of 3 percent in 2024 and 3.9 percent in 2025. However, challenges like relying on imports and ongoing regional instability are hurdles it needs to overcome.
UAE’s forward-thinking approach
Meanwhile, the UAE is forecast to hit growth rates of 3.8 percent and 4.1 percent in 2024 and 2025, respectively. Showcasing what can be considered the most forward-thinking approach, the country has been pivotal in integrating digital innovations into its economic framework. This not only boosts its non-oil sectors but also enhances its attractiveness for global investments.
The country’s triumphs and economic direction were recently put to the fore at the Economy Middle East Summit 2024, graced by the UAE Minister of Economy Abdulla Bin Touq Al Marri himself. Gathering industry leaders to share strategies for navigating the current economic landscape, industry heavyweights convened at the Economy Middle East Summit 2024. Speakers placed a big spotlight on non-oil sectors like tech, tourism, and mobility — all seen as key engines for future growth.
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MENA’s Big Three economies diversify
Further fueling optimism, a recently published report from the World Economic Forum also noted how the Big Three economies “are bucking the global trend, successfully diversifying their economies and carving a leadership role in the new global economy.” These countries’ inclusion in the expanded BRICS group has further enhanced their global economic and political influence.
Reflecting this growing confidence, MENA saw a surge in capital market activity in the first quarter of 2024. According to EY MENA, 10 IPOs raised about $1.2 billion in MENA. Additionally, the expansion of the New Silk Road — stretching across Asia, the Middle East, and North Africa — represents a strategic pivot toward boosting global trade relations.
Despite facing ongoing challenges, the MENA region is determined to prove its economic mettle, with reforms and strategies across multiple sectors and different nations driving growth.
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