Opportunities amid global changes, says IMF director
▶ Turkish President tells Israel to stop expansionist push and calls on international community to save UNRWA
Global challenges present opportunities for the Middle East and North Africa to become more of a “connection point”, the International Monetary Fund’s regional director said yesterday.
While crises including the war in Gaza and disruptions to Red Sea shipping continue to have implications for the region, “there are hopes”, Jihad Azour, IMF director for the Middle East, North Africa and Central Asia told The National.
“There are changes and challenges in the world. The world is more fragmented,” Mr Azour said at the World Governments Summit in Dubai. “But this is opening opportunities too for the region to be more of a connection point, to be more a bridge and a platform.
“There are hopes. The IMF is working on that … to see how we can increase co-operation [between countries] and what that brings with whom to co-operate and how.”
The IMF in January cut its growth forecast for the Mena region as the as the conflict in Gaza compounds challenges for highly exposed economies. Based on the assumption that the Israel-Gaza war eases after the first quarter of 2024, growth in the Mena region is projected to expand 2.9 per cent this year, the Washington-based fund said at the time.
That marks a downwards revision of 0.5 percentage points from the fund’s October 2023 estimates of 3.4 per cent growth for Mena economies, the IMF said in its Regional Economic Outlook
report for the Middle East.
With the Gaza war leading to violence in Syria, Iraq and Lebanon – and Egypt’s economy also affected – concerns have grown that the conflict will have an increasing impact on the wider region.
“Disaster has led to negative economic impact. How to measure that impact? It can be measured in two ways: the impact on the epicentre, the economy of Palestine – Gaza and West Bank – and the impact on the other countries,” Mr Azour said.
Palestine’s economy shrank in 2023 and, with war still raging in Gaza, is expected to do so again this year.
Other countries affected by the war include Lebanon, Syria, Jordan, Iraq and Egypt.
Turkish President Recep Tayyip Erdogan has called on Israel to agree to a two-state solution and stop its violence against Palestinians trapped in the Gaza Strip.
Speaking at the World Governments Summit in Dubai yesterday, Mr Erdogan reaffirmed Ankara’s unwavering support towards the Palestinian people.
“If Israel wants lasting peace, it must stop pursuing its expansionist ambitions and accept the existence of an independent Palestinian state based on the 1967 borders,” he said.
“Israel, which regards itself as above international law, has not abandoned its policies of occupation, usurpation, destruction and massacre.”
President Sheikh Mohamed met Mr Erdogan on the sidelines of the summit yesterday.
Sheikh Mohamed discussed strengthening bilateral relations with Mr Erdogan, and how best to boost the countries’ economic partnership.
The two leaders discussed regional developments, including Gaza, and emphasised the need for international efforts to halt hostilities.
They also spoke of the need to prevent further escalation.
Israel is planning to expand its ground assault in Gaza by entering the city of Rafah, near the border with Egypt. More than one million Palestinians have sought refuge there, from a military assault that has laid waste to much of the enclave since Hamas militants attacked southern Israel on October 7.
The planned offensive has alarmed the US, Israel’s main ally, and drawn international condemnation.
Israeli Prime Minister Benjamin Netanyahu has said the move is necessary to wipe out Hamas and prevent the possibility of further attacks. His forces have increased air strikes on Rafah in recent days.
Turkey will never “leave our Palestinian brothers abandoned, helpless or alone”, Mr Erdogan said.
Ankara had shown “every responsibility and effort to spare this war”, he added.
The Turkish leader said the only way out of the crisis was through the establishment of a Palestinian state.
“Without the independent, sovereign, geographically independent Palestinian state we will not have peace,” he said.
“This is the key to peace, tranquillity and economic development in our region.”
Mr Erdogan called on “conscientious” countries to support the UN agency for Palestinian refugees (UNRWA), describing it as “a lifeline for six million refugees in Jordan, Syria, Lebanon and Palestine”.
The US and other major donors suspended the transfer of
funds to UNRWA last month, after Israel accused 12 of its staff of taking part in last year’s Hamas-led attacks.
Germany, the second biggest UNRWA donor after the US, said it “will temporarily not approve any new funds” until investigations are concluded.
France, Italy and the Netherlands and others have taken a similar position.
“It hurts us to see the attacks against the staff of the UN Palestinian agency and we must extend our support,” Mr Erdogan said.
He said he was not making his appeal as President of a predominantly Muslim country, but as the leader of “a country that has opened its door to the Jewish community in Europe”.
The UN agency, which provides essential services such as schooling and health care, has struggled financially for years and has said it may have to shut down operations if funding does not resume. The suspended funds amount to $440 million, about half of its operational costs.
Since the war in Gaza began, Turkey has taken in more than 300 Palestinian patients for treatment.
Turkey is one of three countries, alongside India and Qatar, to be named guests of honour at the Dubai summit.
More than 25 world leaders and heads of state have arrived for the event.