eBook

Natural resource abundance, growth, and diversification in the middle east and north africa

Diop, Ndiame, Marotta, Daniela, de Melo, Jaime

2012

Overview

MENA is one of the richest regions in the world in terms of natural resources: it holds more than 60 percent of the world’s proven oil reserves, mostly located in the Gulf region, and nearly half of gas reserves. Oil represents 80-85 percent of merchandise exports in the region, making it highly depending on fluctuations in international prices. A long strand of economic literature has suggested that such dependence may hurt a country’s growth prospects and the scope for job creation by reducing economic diversification. This volume investigates the effect of natural resources and the role of policies on achieving higher and sustained growth through diversification away from oil. It explores analytical questions which include: (i) the impact of the real exchange rate on manufacturing and tradable services competitiveness in MENA; (ii) the role of fiscal policy in supporting diversification; (iii) how “weak links” (input sectors with low productivity) play a critical role in explaining the concentration of economic activities, in addition to the classical Dutch Disease effect and (iv) the impact of macroeconomic factors on the drive for regional integration Several policy recommendations emerge from this analysis: (i) policymakers should strive to avoid real exchange rate overvaluation through consistent fiscal policies, flexible exchange rates and adequate product and factor market regulations; (ii) reforms to improve the competition and efficiency of upstream input activities are crucial for improving the performance of downstream activities and diversification in MENA (iii) a consistent and transparent fiscal policy is essential to reduce instability, build the fiscal space needed to invest in core infrastructure and human capital and create a favorable environment for diversification; (iv) while regional trade integration is desirable for political, social, cultural and economic reasons, in terms of trade liberalization, this is not the best option for resource-rich countries of the region. Policymakers should take this into account in discussing regional integration options. It is hoped that the findings of this work will be of interest to policymakers, the civil society, donors and practitioners in MENA countries and stimulate the debate of such an important topic.

• Publisher: THE WORLD BANK,World Bank,World Bank Publications,The World Bank,Washington, DC: World Bank
• Subject: ADVERSE EFFECTS / Africa, North / AGRICULTURAL PRODUCTIVITY / AGRICULTURE / ARABLE LAND / BASE YEAR / BENCHMARKING / BENCHMARKS / BUS068000 - BUSINESS & ECONOMICS / BUS070040 - BUSINESS & ECONOMICS / BUSINESS ENVIRONMENT / CAPITAL ACCUMULATION / CAPITAL FORMATION / CIVIL WAR / CIVIL WARS / CLOSED ECONOMIES / COMMODITIES / COMMODITY / COMMODITY PRICE / COMMON MARKET / COMMUNICATION TECHNOLOGY / COMPARATIVE ADVANTAGE / COMPETITIVENESS / CONSUMER GOODS / CONSUMER PRICE INDEX / CONSUMPTION EXPENDITURES / CONTRACT ENFORCEMENT / CPI / CROWDING OUT / DEMOCRACIES / DEMOCRACY / DESCRIPTIVE STATISTICS / DEVELOPING COUNTRIES / DEVELOPING COUNTRY / DEVELOPING ECONOMIES / DEVELOPING WORLD / Development / DEVELOPMENT ECONOMICS / DIVERSIFICATION / Diversification in industry / Diversification in industry -- Africa, North / Diversification in industry -- Middle East / Diversification-Natural resource abundance-Trade in services-Regional Trade Agreements-Fiscal policy to support diversification-Natural resource heterogeneity-Volatility-Dutch Disease / DOMESTIC COMPETITION / ECONOMETRICS / ECONOMIC ACTIVITIES / ECONOMIC ACTIVITY / ECONOMIC CONCENTRATION / ECONOMIC COOPERATION / ECONOMIC DEVELOPMENT / Economic development -- Africa, North / Economic development -- Middle East / ECONOMIC EFFICIENCY / ECONOMIC GROWTH / ECONOMIC INTEGRATION / ECONOMIC OPPORTUNITIES / ECONOMIC PERFORMANCE / ECONOMIC RESEARCH / ECONOMIC THEORY / ECONOMICS / ECONOMICS RESEARCH / ECONOMIES OF SCALE / ELASTICITY / EMPIRICAL EVIDENCE / EMPIRICAL RESULTS / Energy Industries / EXCHANGE RATE / EXCHANGE RATE REGIMES / EXPENDITURES / EXPLOITATION / EXPORT DIVERSIFICATION / EXPORT GROWTH / EXPORT MARKETS / EXPORTS / EXPOSURE / EXTERNALITIES / FACTOR PRICES / FINANCIAL CRISIS / FINANCIAL DEVELOPMENT / FINANCIAL SUPPORT / FISCAL POLICIES / FISCAL POLICY / FIXED CAPITAL / FIXED EXCHANGE RATE REGIMES / FLEXIBLE EXCHANGE RATES / FOREIGN CAPITAL / FOREIGN DIRECT INVESTMENT / FREE TRADE / FREE TRADE AGREEMENT / GDP / GDP PER CAPITA / GLOBAL ECONOMY / GLOBAL RISK / GLOBALIZATION / Government policy / GROSS DOMESTIC PRODUCT / GROSS FIXED CAPITAL FORMATION / GROWTH EPISODE / GROWTH IN TRADE / GROWTH MODELS / GROWTH PERFORMANCE / GROWTH PROCESS / GROWTH RATE / GROWTH RATES / HIGH CONCENTRATION / HIGH GROWTH / HUMAN CAPITAL / INCOME ELASTICITY / INCOME ELASTICITY OF DEMAND / INCOME GROUP / INCOME GROUPS / INCOMES INCREASE / INDIVIDUAL COUNTRIES / INDUSTRIAL DEVELOPMENT / Industrial policy / Industrial policy -- Africa, North / Industrial policy -- Middle East / INDUSTRIAL SECTOR / INDUSTRIALIZATION / Industries / INFRASTRUCTURE INVESTMENTS / INPUT PRICES / INSTITUTIONAL ENVIRONMENT / INTERMEDIATE GOODS / International Economics and Trade / INTERNATIONAL LABOUR ORGANIZATION / INTERNATIONAL TRADE / JOB CREATION / LABOR FORCE / LONG RUN / LONG-RUN GROWTH / LONG-TERM GROWTH / MACROECONOMIC ISSUES / MACROECONOMIC POLICIES / MACROECONOMIC POLICY / MACROECONOMIC STABILITY / MACROECONOMICS / Macroeconomics and Economic Growth / MANUFACTURING INDUSTRIES / MARGINAL EFFECT / MARKET ACCESS / MARKET ENTRY / MARKET FAILURES / MARKET PARTICIPANTS / MARKET REGULATIONS / MARKET SHARE / MARKET SHARES / MICROFINANCE / Middle East / NATIONAL INCOME / NATURAL MONOPOLIES / NATURAL RESOURCE / NATURAL RESOURCES / Natural resources -- Government policy -- Africa, North / Natural resources -- Government policy -- Middle East / NEGATIVE EFFECT / NEGATIVE IMPACT / NEW MARKETS / NEW PRODUCTS / NON-OIL TRADE / OIL / OIL EXPORTERS / OIL PRICES / OIL RESERVES / OPEC / OPEN ECONOMY / OUTPUT / OUTPUT GROWTH / OUTPUT VOLATILITY / OUTPUTS / OVERVALUATION / PER CAPITA GROWTH / PER CAPITA INCOME / PER CAPITA INCOMES / POLICY IMPLICATIONS / POLICY ISSUES / POLICY MAKERS / POLICY RESEARCH / POLITICAL ECONOMY / POOR COUNTRIES / POOR GOVERNANCE / POVERTY REDUCTION / POWER PARITY / PRICE INDEXES / PRICE LEVELS / PRICE SUBSIDY / PRIVATE CAPITAL / PRIVATE INVESTMENT / PRIVATE SECTOR DEVELOPMENT / PRODUCTION COSTS / PRODUCTION STRUCTURES / PRODUCTIVITY / PRODUCTIVITY GROWTH / PROPERTY RIGHTS / PUBLIC EXPENDITURES / PUBLIC FINANCE / PUBLIC FINANCES / PUBLIC GOODS / PUBLIC SECTOR / PURCHASING POWER / REAL ESTATE / REAL EXCHANGE RATE / REAL EXCHANGE RATES / REAL GDP / REGIONAL INTEGRATION / REGIONAL TRADE / REGULATORY RESTRICTIONS / RENT SEEKING / RESOURCE MANAGEMENT / RICH COUNTRIES / SAVINGS / SCIENTIFIC RESEARCH / SECTOR ACTIVITY / SECTOR REFORMS / STANDARD DEVIATION / STRUCTURAL CHANGE / TECHNOLOGICAL ADVANCES / TERMS OF TRADE / TOTAL FACTOR PRODUCTIVITY / TRADABLE SECTORS / TRADE COMPETITIVENESS / TRADE DIVERSION / TRADE LIBERALIZATION / TRADE POLICIES / TRADE POLICY / TRADE REFORMS / TRANSPARENCY / UNDERVALUATION / VOLATILITY / WAGES / WEALTH / WEALTH DISTRIBUTION / WORLD DEVELOPMENT INDICATORS / WORLD ECONOMY / WORLD TRADE / WORLD TRADE ORGANIZATION / WTO
• ISBN: 9780821395929, 0821395920, 0821395912, 9780821395912