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Towards a new social contract (English)

Whereas the global economy is set for a gradual pick up, economic prospects in the Middle East and North Africa (MENA) remain flat. Growth in MENA is expected to slow down in 2015 and range between 3.1 and 3.3 percent according to the World Bank and consensus forecasts respectively, and continue on the same path in 2016. The main reasons for the continued, sluggish growth are: prolonged conflict and political instability in Syria, Iraq, Libya and Yemen; low oil prices that are dragging down growth in oil exporters; and the slow pace of reforms that is standing in the way of a resumption of investment. Violent conflicts are devastating people’s lives, infrastructure and national economies, with spillovers to neighboring countries such as Lebanon, Jordan and Tunisia. A longer-term perspective indicates a more homogeneous region and a more hopeful future. Despite their current differences, MENA countries have since independence been following more or less the same development model. From internationally comparable data, all MENA countries were below the regression line connecting "voice and accountability" with per capita income. Some people have described this development model as an "authoritarian bargain" (Yousef, 2004) or a social contract. This common social contract delivered relatively successful results on both economic and social fronts. In the 2000s, economic growth averaged 4-5 percent a year. Poverty rates were low and declining. Almost everyone completed primary school, and enrollment rates in secondary and tertiary education, especially for women, were high and rising. MENA registered the fastest decline in infant mortality rates in the world. Contrary to perceptions, inequality (as measured by conventional indicators such as the Gini coefficient) was lower than comparable countries elsewhere and either constant or declining. The MENA Economic Monitor supplements the World Bank's bi-annual MENA Quarterly Economic Brief and presents the short term, macroeconomic outlook and economic challenges facing the countries in the Middle East and North Africa region.


  • Author

    Devarajan,Shantayanan, Mottaghi,Lili

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    Working Paper

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  • Country

    Middle East and North Africa,

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    Middle East and North Africa,

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  • Doc Name

    Towards a new social contract

  • Keywords

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Devarajan,Shantayanan Mottaghi,Lili

Towards a new social contract (English). Middle East and North Africa (MENA) Economic Monitor Washington, D.C. : World Bank Group.