Forecasting the Mideast’s economic landscape in 2016

An interview with Majid Jafar, the CEO of Crescent Petroleum in the UAE

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Interview with Majid Jafar, the CEO of Crescent Petroleum in the UAE, on forecasts for the Middle East’s economic landscape in 2016.

1. How would you describe the current economic landscape in the Middle East and North Africa?

The greater region is facing tough times. Some of the reasons are more obvious than others but for me there are three main factors:

First, the ongoing conflicts in Syria, Iraq, Libya and Yemen. It is an extremely fragile security and humanitarian situation that calls for a decisive collective action. In particular, the deepening refugee crisis needs our attention. To date, more than 4 million Syrian refugees have fled to neighbouring countries, while an estimated 7 million are internally displaced; amounting to the greatest humanitarian catastrophe we have seen in decades.

Second, oil prices shifts challenging resource-endowed nations with the imperative of reshaping their economies vis-à-vis the new global energy landscape. We should translate new investment and energy partnerships among the Gulf Cooperation Council, the Levant and North Africa, with international financial Institutions, into robust communities for growth while fostering job creation and entrepreneurship.

Third, the Middle East and North Africa are suffering from a lot of red tape. Current policy and regulatory frameworks are creating a lot of hurdles for businesses. We need to urgently reform traditional bureaucracy and labour market rigidity, outdated mediation and arbitration methods, to name just a few.

2. What are the most pressing areas requiring reform?
We have identified six areas through the Middle East and North Africa Regional Business Council (RBC) of the World Economic Forum as part of a new initiative aiming at accelerating the policy reform agenda in the region. These areas are:

1. Enhance the efficiency of the labour market
2. Modernize bankruptcy and insolvency regulation
3. Make it easier to start a business
4. Reduce bureaucracy and strengthen government capacity to reinforce contracts
5. Build functional mediation and arbitration methods
6. Promote systems of good corporate governance

3. How can business contribute to address these challenges?

Business cannot do that alone. Building a solid public-private partnership is crucial to addressing these issues, and that is what the Actionable Policy Reforms Initiative is aiming for.

To put this initiative to action, members of the RBC have prepared a set of actionable policy recommendations covering top priority reform areas. During the 2016 World Economic Forum Annual Meeting and beyond, members of the RBC will seek to obtain commitments from governments to endorse the initiative. The subsequent phase will comprise deep dives into the six reform areas and the preparation of an implementation plan in partnership with stakeholders from the public sector.

This article was first published by the World Economic Forum and is part of our Davos coverage.

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