Arab countries to record 5.4% economic growth in 2022

Creative Commons

• Economic growth slow to down to nearly 4% in 2023
• Inflation rate likely to hit 7.6% in 2022 and 7.1% in 2023

Arab countries are expected to see a 5.4 percent in economic growth in 2022, up from about 3.5 percent in 2021, due to rising oil prices, an increase in crude production and the continuation of growth reforms, the Arab Monetary Fund (AMF) said in its latest report.

However, economic growth in Arab countries is expected to slow to about four percent in 2023 due to the decline in global economic growth, commodity prices, and gradual exit from expansionary fiscal and monetary policies, the report added.

Oil-exporting countries in the Arab World will benefit throughout 2022 from increased oil production quantities within the OPEC+ agreement and relatively higher oil and gas prices in international markets, which will support public.

Overall, Arab oil producers are forecast to grow by six percent in 2022, compared to 3.2 percent in 2021. On the other hand, oil prices are likely to decline in 2023, the AMF predicted.

The six GCC countries are anticipated to record a relatively high growth rate of 6.3 percent in 2022, compared to 3.1 percent in 2021, thanks to a combination of factors, including the recovery from the pandemic, economic reforms, and continued adoption of stimulus packages. Economic growth will, however, decline to 3.7 percent in 2023.

The AMF sees inflation rates to reach relatively high levels in some Arab countries in 2022, due to surging food and energy prices, and escalating inflationary pressures.

Agricultural production changes related to climate change will also affect general prices in some countries. Therefore, inflation rate in Arab countries is expected to reach 7.6 percent in 2022 and 7.1 percent in 2023, the report stated.