GCC

By Mouayed Makhlouf, IFC

Look out across the Middle East and North Africa (MENA), and you’ll see a rising tide of youth unemployment. In fact, MENA has the highest rate of official unemployment of any region in the world, averaging at around 11 per cent.

Those are sobering numbers – and a sign that the region hasn’t done enough to create opportunities for its young people. But unemployment in the Middle East and North Africa doesn’t need to be that high.

The region has a large number of companies, many in up-and-coming industries like information technology or logistics, which need workers. Yet job seekers just don’t have the technical skills that employers are looking for, causing many positions to remain unfilled. Read more

By Tomás Guerrero, IE Business School

Nearly all muslim-majority countries currently import much of the food they consume, with imports, as in the case of the Gulf Cooperation Council (GCC) countries, above 70 per cent.

Thus they are net importers of food, and the vast majority of it is halal. In 2013, Muslims spent $1.2tn on food and drink, the equivalent of 17.7 per cent of total world expenditure on food in that year. Of this, $1tn was spent on halal food by the muslim communities in the 57 member countries of the Organisation of Islamic Cooperation.

There are three main factors explaining this dependency: adverse climate, the lack of the knowhow and technology needed in order to boost food productivity and the rapid growth of populations with increased disposable income who are starting to adopt Western patterns of consumption. Read more

By John Sfakianakis, Ashmore Group

The Gulf economies are in a position of strength to weather the recent plunge in oil prices. Many are better cushioned than at previous times in their economic history despite growing domestic populations. Oil prices are a principal revenue source for most Gulf economies and they serve as an essential litmus test for business confidence in the region.

At US$60 per barrel, the region is still fiscally sound even if more than US$280bn in oil export losses will be incurred in 2015. The move in oil prices has been excessive on the way down but it seems to be bottoming out. Read more

It'll cost you

Commenting on the Russian revolution, Joseph Stalin is alleged to have said, “You can’t make an omelette without breaking a few eggs.” What then is the price of eggs?

HSBC has totted up the lost output of seven states most hit by the Arab Spring, and estimates a loss of $800bn by the end of 2014. Read more

Last year was supposed to represent the pivotal moment in which sukuk debt – Islamic versions of bonds – came into their own as a deep, mature and liquid source of funding.

Issuance data from January suggest the jury is still out. Read more

Putting aside Jordan’s fiscal problems, simmering political tensions, significant unemployment, and need to import energy, the small monarchy’s debt might actually be a pretty good bet.

So says Exotix, the frontier markets specialists, who recently initiated a buy on Jordanian debt — even as other analysts worry that fall-out from the Arab spring has put the nation on a dangerous long-term trajectory. Read more