Middle East and North Africa: Growth is expected to pick up to 3.5% in 2024 and remain at that rate in 2025.

The Middle East and North Africa (MENA) region is poised for a growth uptick, projected at 3.5% in 2024 and maintaining that rate into 2025. However, recent conflicts have heightened geopolitical and policy uncertainties, impacting tourism and exacerbating existing challenges. In 2023, MENA's growth slowed to 1.9%, attributed to oil production cuts, inflation, and weak private sector activity in oil-importing economies.

Oil exporters, particularly in the Gulf Cooperation Council (GCC), saw a significant deceleration in 2023 due to reduced oil production. Conversely, exempted countries experienced growth. Oil importers faced slowed growth in 2023, marked by anemic private sector activity, high food inflation, and currency depreciations.

In specific countries, Egypt's growth declined due to import restrictions, reduced purchasing power, and sluggish corporate activity, while Morocco experienced growth despite an earthquake-induced setback. Looking ahead, assuming conflict de-escalation, MENA's growth is forecasted to rise to 3.5% in 2024 and 2025, with the GCC at 3.6% and 3.8%, respectively. Growth in oil importers is expected to reach 3.2% in 2024 and 3.7% in 2025, with variations among countries.

However, significant risks persist, including the conflict's escalation, natural disasters, and climate change impacting the region. Additionally, oil prices and demand fluctuations pose challenges for oil-exporting nations, while oil importers are susceptible to tightening global financial conditions. The economic outlook for the West Bank and Gaza remains uncertain, with potential for growth rebound in 2025 if the conflict de-escalates and reconstruction efforts take place.