The top business/economic stories from the MENA region as reported in the regional press – April 10
MENA/Growth – “The Middle East and North Africa (MENA) is facing a 3.7 percent contraction in gross domestic product (GDP) this year because of twin hits from the coronavirus pandemic and the collapse of demand for oil, the World Bank is forecasting. The fall in GDP, which amounts to about $116 billion off the region’s economies, has accelerated from the 2.1 percent downturn the bank estimated just last month. In October 2019, the bank said Middle East economies would grow by 2.6 percent this year,” Arab News reports.
Oil Market – “Oil market fundamentals have reached ‘horrifying’ levels following the spread of the coronavirus pandemic, with global storage capacity expected to be exhausted by May, Opec’s secretary-general told ministers at an emergency meeting on Thursday. ‘The supply and demand fundamentals are horrifying; the expected excess supply volumes on the market, particularly in the [second quarter of 2020], are beyond anything we have seen before,’ Mohammed Barkindo said in his opening remarks at a virtual conference of Opec and non-Opec producers,” The National reports.
Oil/OPEC+ – “An agreement between Saudi Arabia and Russia for record oil-production cuts was endangered late as Mexico refused to participate in the curbs and left the meeting without approving the deal. The impasse, which came after more than 9 hours of talks via video link, cast doubt over a global effort to revive the oil market from a debilitating coronavirus-induced slump. The OPEC+ group won’t cut output without Mexico’s participation and doesn’t intend to meet again on Friday, instead focusing on talks at the G-20 gathering also scheduled that day,” Bloomberg/Gulf News reports.
UAE/NMC – “Just two years after its market value soared to more than $10 billion, NMC Health Plc was placed in administration by a London court as the troubled health-care provider succumbed to creditor demands. NMC, the Middle East’s largest hospital operator, will be run by administrators Alvarez & Marsal, Judge Sebastian Prentis said via videoconference Thursday. It’s a boost for state-owned Abu Dhabi Commercial Bank PJSC, which is owed $963 million. It had pushed for administration in a bid to get management to relinquish control,” Bloomberg/Arabian Business reports.
Region/IMF – “IMF funding aimed at helping countries hit by coronavirus will likely go to oil importing countries in the Middle East and North Africa (MENA) region – which include Egypt, Lebanon, Jordan, and Tunisia – as well as oil exporters Iran and Iraq, according to a new report from MUFG Bank. The International Monetary Fund (IMF) is moving to provide aid to counter the economic fallout of the coronavirus pandemic, which has shutdown economies across the world and caused a massive hit to global industries such as tourism and aviation. On top of the 70,000 people killed so far, the virus has necessitated lockdown measures, which are likely to cause a recession that will dwarf the 2008 financial crisis,” Al-Arabiya reports.
Iran/IMF – “Iranian authorities have called on the International Monetary Fund (IMF) to accelerate processing Tehran’s request for an emergency loan which it requires for fighting a pandemic. The governor of the Central Bank of Iran (CBI) Abdolnaser Hemmati said on Thursday that the IMF is expected to consider Iran’s request for a $5 billion loan under its Rapid Financing Instrument (RFI), a mechanism which is available to all member countries facing an urgent balance of payments need,” Iran Daily reports.
Lebanon/Inflation – “Inflation in Lebanon in the month of February 2020 alone reached 11.4 percent as the prices of basic commodities surged to alarming levels, according to the Consultation and Research Institute,” The Daily Star of Lebanon reports.
N. Africa – “The African Development Bank (AfDB) has set up a new $10 billion facility to help ameliorate the negative impacts of the coronavirus outbreak on the continent. In a statement, AfDB President Akinwumi Adesina said that the fund would include $5.5 billion for sovereign operations in the countries where the bank operates, and $3.1 billion for sovereign and regional operations in countries that benefit from the African Development Fund, the AfDB’s arm for fragile countries. An additional $1.35 billion will be for private sector operations,” Ahram Online reports.
Tunisia/Libya Logistics – “A cargo shipping line between Tunisia and Libya is to be launched in the second week of April, Tunisia’s Ministry of Transport and Logistics revealed. The service is for Tunisian goods destined for Libya but currently stalled due to the Coronavirus (Covid-19) curfews and border closures in both countries,” Libya Herald reports.
Saudi/Shipping – “Partial completion of International Maritime Industry’s (IMI) vast new shipyard, within the King Salman International Complex for Maritime Industries and Services in Ras Al Khair on Saudi Arabia’s east coast may not be due until late this year of early next, but this has not held up the start of operational activities, including newbuild rig, ship and repair projects with shareholders and third parties according to Julian Panter, IMI’s Vice President of Business Development,” Sea Trade Maritime News reports.