IMF warns Arab states against complacency over debt

DUBAI: The International Monetary Fund yesterday warned Arab states against complacency over a looming debt crisis, urging continued economic reforms despite a rise in oil prices.

Crude prices have rebounded in the region thanks to a deal by producers to trim production, but the IMF said such a change in fortunes should not get in the way of overhauling state spending.

“Required reforms include further steps toward full elimination of energy subsidies, and changes to pension and social security systems – including revisions to retirement age and benefits,” the IMF said in its Regional Economic Outlook for May.

Jihad Azour, director of the IMF’s Middle East and Central Asia department, told AFP higher oil prices should spur change.

“We should not be complacent... oil prices are going up. That definitely does not mean that we should not introduce the reforms. On the contrary, the current environment offers the opportunity to accelerate some of these reforms,” Azour said.

Oil prices have reached around US$ 75 a barrel from under US$ 30 a barrel in early 2016.

Overall growth in the Middle East and North Africa ( MENA) region, which includes all Arab countries and Iran, was forecast by the IMF to reach 3.2 per cent this year compared to just 2.2 per cent in 2017. — AFP