The economic landscape in Egypt, challenges and strategic paths

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Date: 13 - 03 - 2024

Cairo

Source: Al-Wafd newspaper

Dr. Ali Mohamed Al-Khouri

Despite the increasing economic and social challenges that Egypt faces internally, the national economic trajectory continues to show signs of growth, even if this is occurring at a slower pace than expected. However, the general economic scene is accompanied by a noticeable increase in the annual inflation rate, which reached record levels of 30% in January 2024, while food price inflation jumped to more than 70%, which has weighed heavily on the cost of living for the average citizen.

Egypt also suffers from a large burden of external debt as a result of the series of borrowing it has witnessed in recent years. This challenge is greatly exacerbated by the depreciation of the currency and the rise in interest rates, as interest payments have swallowed up more than 45% of total revenues since mid-2023. Then, despite the income generated from the Suez Canal and the tourism sector, the rise in oil prices and the ongoing conflicts in Gaza and other geopolitical tensions are starting to become an obstacle. In addition, there is continued weakness in foreign investment in the country, with the exception of the oil and gas sector, which increases the difficulties of economic recovery efforts.

To address multiple economic challenges, policymakers must adopt a strategic approach that combines immediate tactical measures with long-term structural reforms. The crucial starting point lies in expanding the scope of private sector participation, as the engine of growth and innovation to drive economic growth. The implementation of such policies must be followed by simplifying regulatory frameworks, reducing bureaucratic obstacles, creating an investment-friendly climate, creating job opportunities, and raising the level of efficiency.

Sustainable economic diversification emerges as another strategic pillar. Relying on the Suez Canal and tourism to collect revenues from foreign currencies, although beneficial, exposes the economy to external weaknesses. Diversification into sectors such as renewable energy, technology, and service sectors can mitigate these risks and allow benefiting from new sources of growth and development. This transformation requires an innovative mindset that supports the development of small and medium-sized companies and encourages the adoption of new technologies.

Expanding and improving social safety nets is imperative to protect vulnerable segments of the population from the direct repercussions of economic reforms and adjustments. The worsening rates of inflation and unemployment due to structural adjustments and external shocks have affected the stability of markets and the standard of living of the Egyptian citizen. As such, social interventions to expand coverage, strengthen implementation mechanisms, and ensure adequate support can contribute to maintaining social cohesion during transitional periods.

We come to the focus of managing growing debts and ensuring financial sustainability. A growing debt burden, if not managed systematically and wisely, can hamper economic prospects. This requires adopting clear debt management plans, in addition to financial discipline and prioritizing growth-enhancing expenditures, as a necessary element for maintaining economic stability and investor confidence. It is important that plans include exploring options and opportunities for debt restructuring, improving revenue collection, and rationalizing public spending with the aim of allocating financial resources to high-impact development projects.

Finally, prioritizing education and skills development is key to addressing structural mismatches in the labor market. An educated and skilled workforce is a cornerstone of the modern economy. It is necessary to study the allocation of investment budgets for the education and vocational training sector and continuous learning initiatives, especially for young people, to provide them with the skills and competencies necessary to achieve success in the changing and competitive labor market. Encouraging partnerships between educational institutions and industries to align curricula with market needs will increase employability and productivity.

These recommendations are critical elements to support structural reforms to enhance private sector participation and gradually restore macroeconomic stability to ensure sustainable development and prosperity for all Egyptians.

 

The Arab Federation for the Digital Economy publishes a study on “The Data Economy and its Role in Strengthening Arab Economic Systems”

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Date: 12 - 03 - 2024

Abu Dhabi

The Arab Federation for the Digital Economy, a member of the Executive Office of the Arab Federations Forum at the League of Arab States, issued a new study entitled: “The Data Economy and its Role in Strengthening Arab Economic Systems” in cooperation with the Arab Organization for Administrative Development at the League of Arab States, and the Center for Economic and Financial Research and Studies at the Faculty of Economics and Political Science. At Cairo University, it addresses a number of important strategic topics and recommendations for decision-makers and policy makers in the Arab region.

The study aims to shed light on the role of the data economy in supporting national economic systems in Arab countries in the government and private sectors, and focuses on strategic applications that show the extent of the contribution of data to planning and decision-making processes in various sectors.

The study included a review of some successful experiences, policies and systems governing the data economy at the global level and in some Arab countries, and was used in broader analysis and identifying areas for improvement.

The study also provides a set of recommendations as general guidelines for developing national regulatory policies and infrastructure, and supporting innovation, private sector growth, and entrepreneurship.

 

The Arab Federation for the Digital Economy discusses developments in the Arab Digital University initiative with the Union of Arab Universities

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Date: 08 - 03 - 2024

Abu Dhabi

The Arab Federation for the Digital Economy, a member of the Forum of Specific Arab Federations Specialized in the League of Arab States, held a remote meeting via the Internet with the Union of Arab Universities, in order to discuss the latest developments and developments related to the Arab Digital League initiative and the executive steps in the project.

The meeting was attended by His Excellency Dr. Amr Ezzat Salama, Secretary-General of the Association of Arab Universities, the Assistant Secretary-General of the Union, those concerned with Intilaaqah Company, the platform’s technology partner, and representatives from both sides.

The meeting included a presentation of the digital education and training platform, mechanisms for providing specialized educational and training programs for members of universities, institutions and community members, and criteria for granting trainees accredited certificates.

The digital education platform, in cooperation with the Association of Arab Universities and the Arab Administrative Development Organization, will work to enhance continuing education and contribute to achieving sustainable development goals related to human development, through educational paths designed to meet the needs of the labor market, raise the capabilities of university students and graduates, and employees of the Arab world, and support digital transformation in Arab university and educational institutions.

 

The Arab Federation for the Digital Economy participates in the General Conference of the Association of Arab Universities in its fifty-sixth session in the Republic of Iraq

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Date: 05 - 03 - 2024

Iraq

The Arab Federation for the Digital Economy participated today in the work of the General Conference of the Association of Arab Universities in its fifty-sixth session, which was held in the Iraqi capital, Baghdad, hosted by the University of Baghdad, during the period from March 3-6, 2024, which comes within the framework of strengthening scientific and academic cooperation and scientific research between Arab universities. In the presence of presidents of Arab universities, representatives of specialized Arab and international organizations, and the League of Arab States.

For its part, the Arab Federation for the Digital Economy, through the Assistant Secretary-General, gave a presentation on the Arab Digital University project, which will work as an integrated digital platform for education and training to provide digital educational content to accredited Arab universities, institutes and training centers at low costs and in different languages ​​via the Internet in accordance with international best practices, and the platform will serve as an important tool. And a new one to spread science and knowledge to cover the Middle East, North Africa, and West African countries. The digital university is scheduled to begin the experimental operational phase in March 2024.

His Excellency Dr. Amr Ezzat Salama, Secretary General of the Association of Arab Universities, on the platform and called on all the universities in the Gaza Strip and the Republic of Sudan to quickly subscribe to the platform during the trial period. He stated that the details of the platform will be distributed to the university presidents, explaining the framework of the digital education platform and the mechanisms for providing specialized educational and training programs. For universities, individuals and institutions to benefit from the platform.

 

The Arab Federation for the Digital Economy participates in the Digital Economy Forum in the Republic of Iraq

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Date: 04 - 03 - 2024

Iraq

The Arab Federation for the Digital Economy participated in the activities of the Digital Economy Forum during the period from 4-5 March 2024 in the capital, Baghdad, Republic of Iraq, under the auspices of the Iraqi Council of Ministers and the Iraqi Development Fund, in the presence of a large number of Arab ministers, ambassadors, and the Central Bank, and with the participation of international organizations such as the World Bank and the United Nations Programme. Development Development Corporation, Huawei, other regional companies and representatives of the private sector.

Ambassador Mohamed Khair Abdel Qader, Secretary-General of the Arab Federation for the Digital Economy, gave a speech at the opening session of the forum, explaining that digital transformation helps the growth of the economy in countries, improves the quality of life, supports citizens’ access to services easily, and allows governments to work with greater transparency and efficiency.

Ambassador Muhammad Khair also stressed that the economic sector in the Arab countries is increasing thanks to the investments made by the Arab countries to enhance electronic digital services by transforming government systems into interconnected digital systems to improve work within the state’s administrative apparatus so that it works efficiently and effectively.

The forum’s activities on the first day included three sessions, the first session entitled the current digital landscape in Iraq with the participation of relevant government agencies in the Republic of Iraq, the second session entitled digital transformation solutions and challenges with the participation of groups concerned with international smart card companies, and the third session was a dialogue session entitled “Towards a Future for the Economy.” Arab”.

At the end of the sessions, the Arab Federation for the Digital Economy was honored for its efforts in implementing many activities, programs, projects and initiatives aimed at activating the role of modern technology in the digital economy in order to achieve the interests and ambitions of Arab countries and support the priorities of the digital economy in the Arab region.

 

Resilience and structural reforms in the global economy

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Date: 28 - 02 - 2024

Abu Dhabi

Source: Alittihad Newspaper

Mufakiru Alemarat

Dr. Ali Mohamed Al Khouri

The global economy is facing a critical phase characterized by the slowest half-decade of GDP growth in 30 years. This situation poses major challenges to policymakers around the world, as national policies will be forced to balance immediate economic stability with structural reforms that serve long-term goals.

The World Bank’s latest Global Economic Prospects report highlights the need for flexibility and structural reforms to deal with the current economic landscape. The global economy is expected to enter its third year of continuous slowdown, with estimates indicating a decline in the growth rate from 2.6 percent to 2.4 percent. This slowdown will be most pronounced in emerging economies, where growth is likely to be well below the average recorded in the past decade. Under these circumstances, rising geopolitical tensions and volatile financial conditions compound these challenges and represent additional complex factors that must be addressed.

National policy makers should focus on enhancing economic flexibility, as a way out of this maze. This entails diversifying economic bases, fortifying local industries, and implementing significant investments in human capital. Fostering entrepreneurship and strong support for small and medium-sized enterprises are pivotal, because they The two main drivers of innovation and creating new job opportunities.

Stimulating investment is another very important area. The slowdown in investment growth rates requires concerted efforts to attract foreign direct investment, especially in sectors that promise sustainable growth. The role of policymakers here lies in the task of creating conducive environments for investment, achieving a balance between economic and political stability, while providing a stimulating and attractive environment for investments in pivotal sectors.

Revitalizing international trade highlights a pivotal challenge for economies in light of indicators of global trade growth declining below historical averages. The strategic response to this downturn includes an approach that takes into account re-engineering business processes and activities to make them faster and more effective and reducing trade barriers by reconsidering customs tariffs and non-tariff barriers, with the aim of building a more open and competitive international trade environment. It is necessary to embrace digitization in business processes by integrating digital technologies to improve logistics services, increase the efficiency of supply chains, and facilitate better access to markets, especially for small and medium-sized companies. In addition, the development of e-commerce is imperative to adapt to developments in digital platforms and tools, to enable companies to benefit from global markets effectively, and to maintain their competitiveness.

Addressing the growing debt challenges, especially in developing countries, is an urgent issue. High interest rates have exacerbated these challenges as a worrying problem, given their significant impact on the financial and economic stability of these countries, which makes it necessary to work in cooperation with international financial institutions to In order to find sustainable solutions to debt.

Promoting sustainable development is another key area, and the urgent need to invest in green technologies and renewable energy cannot be overemphasized, as they are essential links to achieving climate goals and ensuring sustainable development. This requires a set of policies that stimulate clean energy investments and support the transition to a low-carbon economy.

In addition to the above, political stability, good governance, and social cohesion are vital factors that enable or hinder economic reforms. In areas that suffer from political unrest or societal unrest, for example, implementing economic reforms is much more difficult, and therefore we find that public confidence And his acceptance of economic policies are necessary for the success of these reforms, because policies that may be viewed as unfair, or disproportionately affect certain segments of the population, can lead to social unrest and political instability, which may lead to… Undermining economic and social reforms, and circulating efforts in vicious circles. Therefore, it is important for policy makers to take into account the social and political contexts in which economic policies are implemented, and to seek to develop comprehensive policies that take into account the needs and interests of all segments of society.

Finally, the power of global cooperation cannot be underestimated in these difficult times. Together, collaborative efforts in areas such as trade, climate change, and global health are essential for achieving a coordinated and effective response to the challenges posed by 2024.

The economic forecasts in global reports require a comprehensive approach based on the foundations of international cooperation to achieve a balance between immediate efforts to achieve economic stability and direct the compass of strategic reforms towards greater flexibility, sustainable growth and development.

Climate change between crisis and opportunity

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Date: 28 - 02 - 2024

Cairo

Source: Al-Wafd newspaper

Dr. Ali Mohamed Al-Khouri

In the face of the escalating climate crisis and a rapidly changing global ecosystem, the imperatives of sustainability and environmental stewardship have become more urgent than ever. The year 2024 represents a pivotal moment in our collective journey towards a more sustainable future, but it is characterized by daunting and formidable challenges that require innovative steps forward. Central to this narrative are the interwoven issues of reducing biodiversity loss, controlling carbon emissions, and harnessing the transformative power of sustainable business practices.

The harsh reality that must be known is that more than 40,000 species are teetering on the brink of extinction, which is worrying and underscores the need for joint action. The biodiversity crisis cannot be considered as an isolated issue, but rather as a link closely linked to the climate crisis, threatening food security, the emergence of diseases, and the loss of vital environmental services on which humanity depends.

In the midst of these environmental turmoil, it is impossible to overestimate the losses that may be fueled by the burdens of enormous challenges represented by environmental collapse, social divisions, and economic uncertainties, which collectively call for a radical reimagining of response mechanisms.


Globally, the luxury products industry, which has long faced criticism due to its environmental impact, has been witnessing major and striking changes in recent times. Giant brands in the world of fashion and the automotive industry are beginning to lead a boom in green and sustainable innovations. Among these efforts, we find Porsche, which has adopted electric energy in its production, and the French Kering Group, a leader in luxury products, which has adopted initiatives to remove carbon from its operations starting in 2012. These endeavors represent fundamental shifts in the sector’s commitment to reducing Environmental footprint and enhancing the positive impact on the environment.

However, the overarching challenge of climate change in general, highlighted by the continued rise in carbon emissions, remains to cast a long shadow over such progress. Global carbon emissions from fossil fuels reached a record level in 2023, exceeding 40 billion tons, an increase of 1.1% over the previous year. This upward trajectory in emissions stands in stark contrast to the need to reduce our carbon footprint to avoid the worst effects of climate change. The irony remains that Western countries lead in some negative indicators, such as the United States, which, despite the decrease in its emissions by 3%, and the decrease in its use of coal, still contributes significantly to this global dilemma.

The way forward requires fundamental reforms to current energy systems, transportation networks, and industrial practices. The transition to net zero is a goal that promises a $12 trillion annual trade opportunity, but is contingent on the world’s ability to mobilize unprecedented resources, innovation, and collaborative efforts across sectors.

The journey towards a sustainable future is fraught with challenges but also full of opportunities. All the data calls for rebuilding the big picture, our work and our interaction with our planet. The risks are great, as we seek to find the delicate balance between the requirements of environmental preservation and economic prosperity. The time is now to forge a path that respects the delicate interconnections of our world, and ensures a livable planet for future generations.

 

Unprecedented challenges facing emerging markets in 2024

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Date: 26 - 02 - 2024

Abu Dhabi

Source: Mufakiru Alemarat

Dr. Ali Mohamed Al Khouri

At a time when the world is suffering negative repercussions from international events and the problematic global economic environment, emerging markets are facing a complex matrix of unprecedented challenges. According to JP Morgan Research; The global economy will witness a general slowdown in its growth by the end of 2024, affected by the lack of liquidity and the difficulty of borrowing. Amundi Research Center’s analysis indicates that the bleak overall growth prospects for advanced economies will have ripple effects in emerging markets, which are, by their nature, sensitive to global liquidity dynamics and external investment flows.

This analysis is justified by several factors, including geopolitical tensions, especially in regions of vital importance to the world’s food and energy supplies, such as Eastern Europe and the Middle East, which create a state of uncertainty and negatively affect investment projects and growth rates. Then, the major economic slowdown in China will affect many economies that depend on trade with China, in addition to the increasing financial pressures in light of the increase in real interest rates. High levels of debt in developing economies, which makes debt servicing more difficult; The fragmentation of trade, resulting from increasing trade restrictions, and shifts towards “friends support” and “close support” strategies of transferring production to friendly and nearby countries, are factors hindering the recovery of global trade.

Sector analysis indicates that there will be variation in the performance of emerging market stocks as a result of the diversified nature of these economies. The Oxford Economics Institute believes that countries in Asia, such as China, the Philippines and Malaysia, appear to be in a good position for sustainable growth. But on the other hand, countries such as Argentina, South Africa, Turkey, and Brazil will face more difficult challenges and will witness weaker growth in the long term. This situation is due to several reasons, including measures related to labor systems, capital flows, and the decisive role of factors such as productivity growth, economic structure, and governance in shaping the economic destiny of these countries.

Inflation rates will remain the dominant concern, with inflation expected to average around 7.6 percent in all emerging markets this year. Although the inflation path will decline in parts of Asia and Latin America; It will also face potential headwinds from renewed pressures on food, energy and commodity prices, which together will pose economic and social challenges for emerging markets.

These data confirm the importance of reconsidering economic strategies in emerging markets. To find a balance between the requirements of economic growth, inflation management, and external vulnerabilities; This calls for a careful approach in dealing with monetary policy, and taking advantage of growth opportunities in specific sectors.

Here, central banks in emerging markets must develop monetary policies that respond to local economic conditions and global changes, especially those related to interest rates and fluctuations in the value of the national currency, and maintain sufficient foreign exchange reserves. The careful balance between these measures will be pivotal to stimulate growth, ensure economic stability, and investor confidence.

Emerging market governments must be aware of the importance of maintaining sustainable debt levels while investing in growth-enhancing sectors, which requires the strategic allocation of resources towards infrastructure, education and technology projects. As sectors that will stimulate growth in the long term; Structural reforms aimed at improving administrative and governance systems, enhancing business environments, and encouraging innovation will be vital elements in attracting foreign investment and enhancing competitiveness.

Digital transformation represents a unique opportunity for emerging markets. Investing in digital infrastructure and promoting an enabling environment for technological innovation can contribute to moving beyond traditional growth models. It is important that these investments focus simultaneously on skills development, entrepreneurship, and regulatory frameworks that support the digital economy.

Emerging markets must also be aware of everything that might undermine their role in global trade, and seek greater regional integration to increase market access, invest in regional infrastructure to facilitate smooth cross-border trade, and reduce trade barriers to serve common interests. The nature of emerging markets, which exposes them to external shocks resulting from financial fluctuations in global markets, fluctuations in commodity prices, or geopolitical tensions, requires building local capabilities, especially diversifying the economic base, strengthening social safety nets, and developing the financial sectors.

Economies are often more vulnerable to climate-related impacts, such as floods, droughts and extreme weather events, which can have devastating effects on agriculture, infrastructure and overall economic stability. In addition, the global shift towards sustainable and environmentally friendly economies may present challenges and opportunities for emerging markets. For example, countries that depend on fossil fuel exports may face economic challenges; Due to the decline in global demand for this type of fuel, while other countries could benefit from investments in renewable energy sources and green technology. International environmental policies and agreements, such as the Paris Agreement, increasingly influence trade and investment decisions. As a result, emerging markets must understand these complex dynamics, invest in climate resilience, transition to sustainable energy sources, and align with global environmental standards. This strategic axis could open new horizons for growth, attract green investments, and enhance sustainability in the long term.

International cooperation remains a key enabler for emerging markets; To access global financial resources, transfer technology, and achieve sustainable development in these economies. Collaboration with international institutions, multilateral banks, and development partners can provide a platform for accessing the support and expertise needed on this journey. To build understanding and enhance careful engagement with regional and international challenges and opportunities, sectoral dynamics, and strategic positioning in the global economic fabric.

 

The Arab Federation for the Digital Economy participates in a workshop on the uses of artificial intelligence in smart agriculture methods in the State of Qatar

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Date: 25 - 02 - 2024

Doha

The Arab Federation for the Digital Economy participated in a workshop on the uses of artificial intelligence in smart agriculture methods, which was held within the activities of the Qatar Horticultural Expo 2023/2024 during the period from February 25-26, 2024 in the State of Qatar, under the patronage of His Excellency Ahmed Aboul Gheit, Secretary General of the League of Arab States, In the presence of His Excellency Mohammed bin Ali Al Mannai, Minister of Communications and Information Technology of the State of Qatar, and jointly organized by the Technical Secretariat of the Council of Arab Ministers for Communications and Information, and the Arab Academy for Science, Technology and Maritime Transport.

During the workshop, His Excellency Ambassador Mohamed Khair Abdel Qader, Secretary General of the Arab Federation for the Digital Economy, presented a working paper on the Arab Union for the Digital Economy initiative on the digital Arab food market, and explained the problems that this initiative can address and the solutions it provides in response to the urgent situations and challenges of agricultural development and Arab food security. Pointing out that the Arab Food Market platform is an advanced digital platform that connects its various components, which include the exporter and seller, the buyer and importer, as well as all suppliers of supporting services, which include “transportation – logistics services – storage – inspection, testing and classification – issuing certificates – financing and lending – insurance.” “Customs clearance,” and the implementation mechanisms depend on Blockchain technology, through which financial dues can be transferred according to the agreed-upon contracting mechanism and guaranteed by the platform through an intermediary bank account that allows the payment of amounts according to the completion of work and approvals on the system, to be transferred between digital wallets from the importer to the other. Source.

Ambassador Muhammad Khair stressed that the digital Arab food market platform will achieve many economic and commercial benefits for Arab countries by preparing economic growth, by creating opportunities, and opening commercial markets for Arab products through this Arab alliance within the framework of the market, which includes government agencies and the sector. Private, Arab organizations and federations.

In his speech, the Secretary-General of the Arab Federation for the Digital Economy called on all concerned Arab companies and institutions to register on the Arab Food Market platform and display their products.

 

How does the digital economy shape new models of cooperation and exchange?

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Date: 21 - 02 - 2024

Cairo

Source: Al-Wafd newspaper

Dr. Ali Mohamed Al-Khouri

In an era in which the pace of technological and digital development is accelerating, new economic models are emerging that go beyond traditional methods of production and consumption, and the “sharing economy” is one of the most prominent of these models. This model relies on technology to expand collaboration and exchange practices, and represents a radical shift in how individuals, communities, and businesses interact with resources and services.

Sharing economy basics and drivers

The sharing economy is based on a simple but revolutionary principle; This is that the idea of ​​access to goods and services may be more important than owning them. Through digital platforms, this model enables efficient redistribution of underutilized assets, promotes optimal use of resources and reduces environmental footprint. Platforms such as Uber, Lyft, and Airbnb have not only changed the sectors in which they operate, but have also influenced global economic models, demonstrating the transformative power of the sharing economy.

According to the latest studies, the sharing economy is expected to grow significantly over the next decade, with its global size expected to reach more than $500 billion by 2025, which also reflects the high demand for collaborative models and the widespread acceptance of this model in the global economy.

Then, the impact of the sharing economy goes beyond individual consumers, and extends to companies and institutions. By adopting shared resource models, it has become possible for companies to share resources and infrastructure, raise operational efficiency, reduce costs, and provide innovative services. This emerging collaborative approach is pushing the boundaries of traditional businesses and expanding their offerings and opportunities to enter new markets.

Economic, social and environmental impact

The sharing economy promises to achieve a balance between the economy, society and the environment, as it works to establish the principles of equality and distribute national resources more equitably, and expands on improving practices of access to resources and services, reducing the need for excessive individual consumption and investment in fixed assets, which in turn enhances economic efficiency and reduces waste. Moreover, with the advantage of providing opportunities to reuse unexploited assets, it contributes to enhancing environmental sustainability and supports green practices. From a social perspective, the sharing economy contributes to deepening social ties by encouraging interactions between individuals and segments of society, and provides economic opportunities to create alternative and flexible sources of income.

The sharing economy represents an important shift in the way we think about the economy and how to exchange resources and services, instead of focusing on individual ownership and excess consumption, and relies on the concept of participation, cooperation, and solidarity between individuals and communities to achieve common benefits.

The role of governments and public policies

For the sharing economy to achieve its full potential, supportive regulatory frameworks and policies remain essential, and governments must work to build environments that encourage innovation while protecting the rights of participants and consumers and ensuring fair competition. Policymakers must play their role in overcoming regulatory obstacles, especially concerns related to job security and the need for digital inclusion. Addressing these issues requires collaborative efforts among stakeholders to ensure that the sharing economy benefits all segments of society without exclusion and is in the interest of national economic growth.

What we must be aware of is that the sharing economy is more than just a new economic model; It is a means of enhancing competitive economic capabilities, and the expected task of policymakers is to formulate policies that feed this new economic model while addressing its challenges, and ensuring the expansion of its positive impact at the national economic level.