Growth in Middle Eastern and North African oil-exporting economies will accelerate next year as crude production rises, the International Monetary Fund said.
Gross domestic product in those countries will expand 5 percent in 2011 after growing 3.8 percent this year and 1.1 percent in 2009, the Washington-based lender said in its regional Economic Outlook released today.
Those forecasts put oil exporters on course to grow faster than most of the world’s major economies, which are still struggling to overcome the worst global slump since World War II. The IMF said on Oct. 6 that it expects global gross domestic product to expand 4.2 percent in 2011.
“The recovery is taking hold in this region” as demand for oil increases, Masood Ahmed, IMF director for the Middle East and Central Asia, said in an interview in Dubai.
The economies of the Gulf Cooperation Council, which include Saudi Arabia, will be helped as crude oil production climbs to 26 million barrels per day in 2011 from 25 million barrels per day in 2010, the IMF said.
The combined current account surplus of the oil exporters in the region will rise by about $80 billion on current oil price expectations, the IMF said. Of this, close to $50 billion is accounted for by GCC members.
Non-oil growth among crude exporters is likely to be “less robust,” according to the report, picking up only by an estimated 1 percentage point between 2009 and 2011.
“Credit growth is still pretty low in most of the economies of the Gulf,” Ahmed said. That makes stimulus spending “both necessary and useful,” he said.
The IMF nevertheless raised its growth forecast for the United Arab Emirates in 2010 to 2.4 percent from 1.3 percent, in part because of a recovery in the non-oil economy in Dubai. In 2011, growth will accelerate to 3.2 percent.
“We have seen a recovery in activity related to trade, related to logistics” in Dubai, Ahmed said. “Tourism is holding up well.”
Real estate prices in Dubai suffered during the global financial crisis as falling demand led to half of all planned projects being canceled. A housing glut also forced prices lower.
“There is a significant stock of real estate that has yet to be completed and occupied” in Dubai, Ahmed said.
The economies of oil importers in the Middle East, North Africa, along with Afghanistan and Pakistan, are expected to grow 5 percent in 2010, compared with 4.6 percent in the previous year, according to the report. For 2011, growth is projected to ease to 4.4 percent.
The report recommended that oil importers in the region focus on reaching growth levels fast enough to create enough jobs, and diversify their exports to include markets in South America and Asia, instead of mainly relying on Europe.