Creating Jobs Remains Key Priority for Middle East, North Africa

IMF stresses importance of job creation, inclusive growth in region

Oil price developments, geopolitical uncertainty highlighted

Islamic finance has potential to increase financial inclusion, spur growth

And spillovers from deepening regional conflicts pose a risk to this recovery.

Countries that have succeeded in stabilizing their economies should press ahead with their economic reform agendas, IMF Middle East and Central Asia Department Director Masood Ahmed told reporters at the IMF-World Bank Spring Meetings in Washington.

“The big issue is how to create jobs, particularly for young people, since that has been a driver of not just economic but also social unrest in these countries,” Ahmed said.

The meetings brought together ministers and top government officials as well as journalists, academics, private sector participants, and representatives of civil society from all over the world to debate the key issues facing the global economy.

In addition to official meetings with country delegations, a number of seminars and briefings focused on topics of relevance to the region. In a gathering that has become a regular feature of these meetings, IMF Managing Director Christine Lagarde met with the region’s ministers of finance and central bank governors to gain insight into the pressing economic issues they face, including on how the recent slump in oil prices is affecting the region.

Regional outlook

The region’s oil-importing countries are seeing higher growth, owing to prudent economic management combined with a more favorable international environment, Ahmed told reporters during a briefing on economic developments in the region. In particular, lower oil prices are boosting growth, although some countries have chosen to save the gains from lower oil prices, strengthening their budgets and increasing international reserves.

As a group, the oil importers will likely see their growth rate increase to about 4 percent this year from about 3 percent in 2014, Ahmed said. But there are significant risks to this outlook, he cautioned.

Security problems and spillovers from regional conflicts such as those in Syria and Yemen present risks to the region. A deepening of these conflicts could compound this negative effect, he said. Another risk is the movements of international exchange rates—in particular, the strengthening of the U.S. dollar—which could hurt the region’s competitiveness.

As for the region’s oil-exporting countries, Ahmed said he...