Sinking to their lowest levels in 5 years, oil prices were the main turbine of global economies during the last quarter of 2014; either they were importers or exporters of the commodity. In the Arab World, and starting with one of the largest oil producers in the world, Saudi Arabia underwent by the end of 2014 the repercussions of lower oil prices on its fiscal position with the kingdom expecting a $39B fiscal deficit in 2015. Stepping to the booming Qatar, the country continued working on its mission to progressively reduce its dependence on hydrocarbon industries and develop the role of the private sector. Despite their falling oil revenues, the United Arab Emirates (UAE) maintained their strong economic growth benefitting from a prosperous tourism and real estate sectors. When it comes to the MENA’s oil importers countries, and besides the partly positive economic impact of oil prices’ slump, the ongoing regional turbulences on both the political and security fronts were also substantial factors largely influencing their macroeconomics. As the reach of the extremist groups of the Nusra Front and the Islamic State expanded the scope of the conflict, Syria kept on struggling to survive in the last quarter of 2014. As for Lebanon’s economy, it showed a humble economic growth as the security situation remained precarious. A slight improvement was experienced in some sectors due to the low base reached in 2013, such as real estate and tourism, while in the external sector; the Balance of Payments remained in negative territories. Jordan’s proneness to regional difficulties appeared to be restricted to its trade sector as it seems that the Kingdom is taking the necessary steps to protect an otherwise progressing economy. Expectations of Jordan’s economy improving in 2015 are high as policies put in place began to make a positive impact on financial sectors and tourism.
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MENA Review and Quarterly Outlook – Q4 2014