Filtered by Subscriptions: Middle East & North Africa Economics Use setting Middle East & North Africa Economics
Saudi Arabia returned to the international bond market this month in order to plug its twin budget and current account shortfalls. A total of $12.5bn of dollar debt was issued, split into three tranches – $3bn was sold at a five-year maturity, $5bn at …
28th September 2017
Financial markets in the Gulf economies have performed poorly in the past few weeks despite the sharp rise in oil prices. Equity markets have actually fallen back and, in some countries, dollar bond spreads over US Treasuries have widened. Investors may …
27th September 2017
The Saudi government’s decision to lift the ban that prohibits women from driving in the Kingdom is clearly a positive step for women’s rights and could potentially have a significant economic impact by increasing the very low female labour force …
The latest evidence suggests that the hit to Qatar’s economy from the diplomatic crisis with regional powers is starting to fade. Even so, a quick diplomatic solution to the crisis appears increasingly remote and, against this backdrop, we expect growth …
21st September 2017
Saudi inflation remained in negative territory in August but with the government gearing up for a fresh round of subsidy cuts as well as the introduction of a new value-added tax, inflation is likely pick up sharply to 4.0-4.5% early next year. … Saudi …
20th September 2017
The worst of the downturn in Saudi consumer spending appears to have passed, but there’s no sign yet that the reversal of civil service benefit cuts earlier this year has boosted the recovery. With austerity set to resume in 2018, we expect household …
19th September 2017
Kuwait’s balance sheet is the strongest in the GCC, but ongoing austerity and slow implementation of the latest development plan mean it is likely to be among the region’s weaker performers in 2018-19. … Kuwait: strong balance sheet, but weak …
14th September 2017
After a dreadful few years, Egypt’s tourism sector has shown tentative signs of a recovery. Government hopes that the sector can quickly return to its pre-2011 heyday are well wide of the mark, but a pick-up in tourist receipts should still help to narrow …
13th September 2017
The drop in Egyptian inflation last month, to 31.9% y/y, confirms that it has now passed its peak. We expect it to fall sharply towards the end of the year which should bring interest rate cuts on to the agenda. … Egypt Consumer Prices …
11th September 2017
Reports that the Saudi government is planning to dilute its reform plans may be the first sign that the power and influence of Crown Prince Mohammed bin Salman is starting to wane and that broader opposition to reform is building. There’s a clear risk …
7th September 2017
Egypt’s budget deficit has narrowed sharply over the past year and the high public debt-to-GDP ratio should start to fall back soon. However, the authorities have already missed some of the fiscal targets outlined by the IMF back in January. For now, …
6th September 2017
August’s whole economy PMIs for the MENA region suggest that recoveries in non-oil sectors in the Gulf have regained some momentum, while Egypt’s economy has picked up on the back of stronger external demand. … Whole Economy PMIs …
Changes at the top of the royal family have paved the way for King Salman’s son, Mohammed bin Salman, to accede to the throne, with some suggesting that an abdication and succession could take place in the next month or so. In this Watch, we take a closer …
30th August 2017
The diplomatic crisis between Qatar and regional powers seems to be in deadlock. Saudi Arabia and its allies revised their demands in July to something that appeared to be more palatable for Doha, but the Qatari authorities have refused to enter into …
24th August 2017
Equity markets across most of the emerging world have risen over the past month but those in the Middle East and North Africa have fallen back, continuing their underperformance this year. Stocks in the Gulf have struggled against the backdrop of …
23rd August 2017
Our GDP Tracker suggests that the downturn in the Saudi economy deepened in the second quarter and we expect GDP to fall at an even steeper pace over the second half of the year. Over 2017 as a whole, we expect the economy to contract by 1.0%. … Saudi …
22nd August 2017
The Central Bank of Egypt brought its tightening cycle to an end last night. With inflation likely to fall sharply over the next six-to-nine months, we expect that the MPC will start to ease monetary policy by the end of the year. Ultimately, we think …
18th August 2017
The early evidence suggests that the diplomatic crisis between Qatar and regional powers dealt a damaging, but apparently brief, blow to Qatar’s economy. … Qatar’s diplomatic crisis: the economic hit so …
15th August 2017
Egyptian inflation rose to its highest rate since 1986 in July, but it has been pushed up by a number of one-off factors that will fade over the next six-to-nine months. Indeed, we think inflation has now peaked and will begin to fall more quickly than …
10th August 2017
July’s ‘whole economy’ PMIs for the MENA region suggest that recoveries in the nonoil sectors of the Gulf economies resumed at the start of Q3, while conditions in Egypt’s economy appear to have improved markedly. … Whole Economy PMIs …
3rd August 2017
Our GDP Tracker suggests that the pace of contraction in Saudi Arabia’s economy eased between March and April. However, that is likely to be temporary, and we expect Saudi GDP to fall at a steeper pace in the second half of the year than in the first …
2nd August 2017
There is growing evidence that the diplomatic crisis between Qatar and regional powers has (at least temporarily) hurt Qatar’s economy, but there are also signs that tensions in the country’s financial markets have eased more recently. … Strains in …
31st July 2017
A large chunk of the recent widening of Morocco’s current account deficit to around 5% of the GDP can be explained by a one-off jumps in import, mainly related to the expansion of capacity in the country’s export sector. Accordingly, we don’t think there …
28th July 2017
Egypt’s central bank appears to have been intervening in the foreign exchange market to prevent the pound from strengthening, but we think the forces putting upward pressure on the currency will soon start to fade. We remain comfortable with our view that …
26th July 2017
Diplomatic efforts have failed to bring an end to the stand-off between Qatar and the so-called Anti-Terror Quartet (Saudi Arabia, UAE, Egypt and Bahrain). Encouragingly, though, there are signs that tensions are easing and that the groundwork is being …
21st July 2017
Saudi inflation remained in negative territory last month, although the introduction of new “sin” taxes on sugary drinks and tobacco caused the rate of decline ease. And there are reasons to think that outright deflation may not last much longer. … Saudi …
18th July 2017
Saudi Arabia’s official foreign exchange reserves have continued to decline sharply, despite the marked improvement in the current account position over the past year or so. This has raised concerns in some quarters but, as we explain in this Watch, it …
17th July 2017
A threat by regional powers to expel Qatar from the Gulf Cooperation Council (GCC) has sparked fears that the group could be disbanded. A complete breakup of the GCC seems highly unlikely but, even if we are wrong, there are good reasons to think that the …
12th July 2017
Egyptian inflation inched up to 29.8% y/y in June and recent subsidy cuts will cause it to rise a bit further in the next few months. Even so, as the effects of last year’s sharp drop in the pound start to unwind towards the end of 2017, inflation will …
10th July 2017
The Egyptian central bank’s surprise decision late last night to hike its benchmark overnight deposit rate by 200bp, to 18.75%, was largely a response to recently-announced subsidy cuts, which will temporarily push up inflation. However, the accompanying …
7th July 2017
The slowdown in the Middle East and North Africa should bottom out in the second half of this year and growth is likely to strengthen in 2018-19. In the Gulf, the hit to headline GDP growth from OPEC-agreed oil output cuts will start to fade next year as …
5th July 2017
June’s PMI data suggest that Saudi Arabia’s non-oil economy has lost a bit of steam, but this probably partly reflected a deterioration in sentiment on back of last month’s dip in oil prices. The recent reversal of civil service benefit cuts should …
4th July 2017
Political developments have dominated the news in the MENA region this month. In Qatar, financial markets have sold off amid a diplomatic spat with regional powers. So far, though, the broader economic impact appears to have been limited. Qatar’s oil and …
30th June 2017
Saudi Arabia’s economy recorded its first outright contraction since the global financial crisis in Q1, driven by the impact of oil production cuts. The contraction is likely to deepen over the rest of year and, while the economy should return to growth …
The recent elevation of Saudi Arabia’s Mohammed bin Salman to crown prince has raised hopes of a renewed impetus to push through his Vision 2030 reform programme. But, while the scope of the programme is impressive, it will face numerous implementation …
27th June 2017
Saudi Arabia’s equity market has rallied on the back of MSCI’s decision to put the country on its “watch list” for an upgrade to Emerging Market status, but there are a few reasons to think that the optimism may be overdone. … Saudi markets rally as MSCI …
21st June 2017
The decision by Saudi Arabia’s King Salman to promote his son, Mohammed bin Salman (MbS), to crown prince provides some clarity on the line of succession. That being said, many of the barriers to the government’s economic reform drive remain in place and …
Recent comments from the IMF and ratings agencies have put the focus back on the weak balance sheets of the Gulf’s two smallest economies, Bahrain and Oman. We have warned for some time that both countries faced a sizeable adjustment to low oil prices …
15th June 2017
Saudi inflation stood in negative territory for a fifth consecutive month in May, but with subsidy cuts in the pipeline outright deflation is unlikely to last much longer. … Saudi Arabia Consumer Prices …
14th June 2017
Concerns over the impact on Qatar from its diplomatic spat with neighbouring countries have largely focussed on trade ties, but we think investors should be keeping a closer eye on Qatar’s banking sector. While a full-blown crisis seems unlikely, external …
13th June 2017
The diplomatic spat between Qatar and its neighbours has sparked fears that it may be forced to devalue the riyal, but we think this is highly unlikely. In particular, the country’s strong balance sheet means that the authorities are well-placed to …
8th June 2017
The drop in Egyptian inflation in May supports our view that last month’s surprise interest rate hike will be a one-off. That said, rate cuts are unlikely to come on to the agenda until the turn of the year. … Egypt Consumer Prices …
The recent spat between Qatar and regional powers has escalated over the past 24 hours, but there are good reasons to think that the impact on these economies and global energy markets will be limited. … Economic fallout from Qatar diplomatic spat likely …
5th June 2017
May’s PMI data suggests that recoveries in the Gulf’s non-oil sectors have lost a bit of momentum, but we don’t think this marks the start of a sharp downturn. Elsewhere, the PMIs brought further evidence that Egyptian firms are benefitting from a boost …
Stock markets across the Middle East and North Africa have struggled over the past month, continuing their relative underperformance since the start of the year. This largely reflects weakness in Gulf equities following a dip in oil prices; those in the …
31st May 2017
OPEC’s decision this month to roll over its oil output cuts displayed a rare sense of cohesion from the cartel, but there are signs that de-facto leader Saudi Arabia is seeking an eventual end to intervention. The extension of the cuts to the end of March …
30th May 2017
Our GDP Tracker suggests that Saudi Arabia’s economy stagnated in March as oil production cuts continued to trim headline growth. Encouragingly, though, the non-oil economy strengthened further and the early signs are that this continued in Q2. … Oil …
OPEC’s decision to rollover its oil output cuts didn’t come as a surprise, but the fact that calls for deeper cuts never even made it on to the table suggests that the Gulf economies are resistant to bolder action. While the cuts will continue to trim …
25th May 2017
We were in Dubai last week for meetings with clients and local contacts. In this Update, we summarise three key takeaways from our visit. … Dubai: notes from the …
24th May 2017
The Egyptian central bank’s surprise decision late last night to hike its benchmark interest rate by 200bp, to 16.75%, appears to the result of pressure from the IMF. The move is likely to be a one-off and we expect the next change in interest rates to be …
22nd May 2017
