Cairo

Source: Al-Akhbar Almsaey  newspaper

He said – Dr. Ali Mohamed Al-Khouri, President of the Arab Union for the Digital Economy and Advisor to the Council of Arab Economic Unity at the League of Arab States, said that although the Arab region, the Middle East and North Africa in general, and the Arab Gulf region in particular, have enjoyed great wealth over the course of six decades, after the discoveries of oil and gas since the 1950s of the last century. Despite global economic reports indicating improved Arab economic growth performance over the past thirty years, this is considered a bad indicator of economic growth compared to many regions around the world.

Al-Khoury confirmed in statements to “Al-Akhbar Almsaey” that a report issued by the Regional Office for Arab States in the International Labor Organization and the Organization’s Office for Employer Activities, issued in 2021, showed that it included the Arab countries and the Middle East and North Africa region, and which specialized in labor productivity and trends in the Arab countries region. From the 1950s until now, over a period of more than six decades in all countries of the region, which revealed that when compared to other regions around the world, the Arab countries region is now considered the worst performer globally in terms of productivity growth.

The report explained that between 2010 and 2019, productivity growth in Gulf Cooperation Council countries decreased by 0.8 percent, and in countries outside the Gulf Cooperation Council by 1.5 percent. In comparison, productivity growth in emerging and developing countries in other regions rose by 3.1 percent on average over the same period, while in advanced economies it rose by 1 percent, with the global average registering a 2.1 percent increase.

Reasons for the decline in economic growth in the Middle East

He added that the report revealed that the main reasons behind this declining trend in the Arab region are the lack of economic diversification in light of reliance on low productivity sectors, in addition to the inability to invest financial profits in enhancing productivity growth, and the lack of investment in workforce skills to meet the needs of the country. New needs of the labor market.

The report shows that most Arab countries have witnessed a premature decline in industry, so they currently lack a solid industrial sector, with economic strategies in most countries of the region focusing on service sectors with low added value or on the financial sectors and the construction sector, and this has hindered… Productivity growth, because services are less capital-intensive and less open to international competition, which harms economic and productivity growth and leads to an increase in informal employment.

Decreased growth of manufacturing industries in the Middle East

He explained that the decline in the rates of the manufacturing sector in the national GDP in the region is one of the reasons for the weakness of overall economic growth, especially since this rate was very low in Lebanon, where it recorded 3.1% of the national GDP in 2020 compared to 8.3% in 2008, and recorded In Iraq, it was 7% in 2020 and remained stable over the past 20 years, while in Kuwait, it recorded 6% in 2020, where it maintained stability over the past 20 years.

The proportion of the manufacturing industry in the GDP was also recorded somewhat low in Qatar and Oman, where the proportion of this sector was 7% in 2020, while it recorded moderate growth in the Kingdom of Saudi Arabia, where it recorded 13% in the Kingdom of Saudi Arabia in 2020.

Challenges and obstacles facing sustainable development in the Middle East

He pointed out that sustainable development faces many challenges and obstacles in the Arab region and the Middle East, including political instability in a number of countries in the region, the inability to obtain credit for investment and financing of circulating capital, the lax tax system, the lack of access to electricity, and the anxiety and fear of capitalists from investing. The insufficient size of the market, and the lack of a real economic system that helps circulate and develop capital.

The governments of the region must pay attention to many things in order to bring about sustainable economic development, which helps strengthen the pillars of the economy in the region in order to face global challenges and competition, and to be present among strong economic systems around the world, including enhancing regional integration by removing trade barriers and establishing commercial areas that belong to the market. A unified agreement may significantly increase the export potential of the region, focusing on economic strategies, which include diversification in oil-dependent countries and on broader structural change in non-oil-dependent countries, opening up the space to the private sector, and reducing the tasks and size of dependence on the government sector. And good economic planning by relying on flexible economic systems that can develop and create productive economic development, and staying away from rentier economic systems that cause the collapse of many global economies.