Low oil prices are an apportunity for the Middle East

Business leaders from the Middle East North Africa Region gathering at the World Economic Forum in Davos this year are calling for greater economic reforms in the Arab World in order to lower dependence on oil, reduce the burden on government budgets, and unlock stronger economic growth and job creation through private sector investments. This comes as the IMF reports average economic growth slowing to below 3% in the Middle East, with fiscal deficits close to 15%.
“With oil prices falling by 75% and our region still facing instability and a refugee crisis in several countries, the need for true economic reforms to drive growth and create job opportunities for the youth is greater than ever,” said Majid Jafar, CEO of Crescent Petroleum and a member of the Global Agenda Council on the Middle East and North Africa at the World Economic Forum.
The initiative of the Regional Business Council for Middle East North Africa at the World Economic Forum entitled “Actionable Policy Reforms Initiative” (APRI), aims to accelerate the policy reform agenda in the region in 6 key practical areas: enhance the efficiency of the labour market; modernize bankruptcy and insolvency regulation; Simplify the process of creating a company; reduce bureaucracy and strengthen government capacity to reinforce contracts; build functional mediation and arbitration methods; and promote systems of good corporate governance.
Mr. Jafar, who was selected as Champion of the initiative, will be speaking at the World Economic Forum in Davos as a session entitled “Building More Resilient Arab Economies” with other business leaders from the region, as well as the Prime Minister of Lebanon, HE Tammam Saeb Salam, and HE Suhail bin Mohammed Al-Mazrouei, UAE Energy Minister.
“Youth unemployment in our region at 30% is the highest average in the world and the fastest growing rate and this requires urgent action through cooperation between the public and private sectors. At the same time, the lower oil prices present a real opportunity for our region to tackle some key challenges such as energy subsidies and regulatory reform, in order to create more productive and competitive economies
through diversification,” Jafar added.
Over 40 heads of state and government, as well as 2,500 leaders from business and society will convene at the 46th World Economic Forum Annual Meeting, from 20 to 23 January in Davos-Klosters, Switzerland, under the theme, “Mastering the Fourth Industrial Revolution”. Critical current challenges, such as security, climate change and “new normal” global growth and commodity prices, are among the issues on the agenda.