Photo: Hiba Kallas, Shutterstock

More debt, slower recovery in the Middle East

The outlook is not good: hunger in the Arab world is on the rise (by 90 per cent since 2000). Debt is growing, economic recovery is weak and uneven.

(IPS) – A 2021 report on food security and nutrition in the Middle East and North Africa shows that the amount of hungry people in the region reached a figure of 69 million in 2020. This was triggered, according to the report, “by ongoing crises, social unrest and the experience of various shocks and stresses such as conflict, poverty, inequality, climate change, scarce natural resources and the economic setbacks associated with the recent Covid 19 pandemic.”

According to the report, about one-third of the population in the Arab regions (or 141 million people) experienced “moderate or severe food insecurity” in 2020. This is an increase of more than 10 million compared to the previous year.

Only four of the leading Arab oil producers (Saudi Arabia, Qatar, the United Arab Emirates and Kuwait) enjoy incomes that save them from the region’s worsening hunger crisis. The other 18 states – some like Algeria, Iraq and Libya are also producers of gas and oil – face “health, food and nutrition insecurities.”

In the case of Yemen and its 30 million inhabitants, the gross national product is low at $19 billion. That of the United Arab Emirates, with 10 ten million inhabitants, is around 100 billion. That is five times more than Yemen with only one-third of the people. Another example is Saudi Arabia (33 million). Its gross national product reaches 700 billion US dollars. Meanwhile, Egypt, with three times the population, has less than a third of Saudi Arabia’s economic output.

Conflict remains one of the most serious causes of hunger in the region. Some 53.4 million people go hungry in those states and regions ravaged by armed conflict. That is six times more than in conflict-free countries, says Abdulhakim Elwaer, FAO Assistant Director-General and Regional Representative for the Middle East and North Africa. “There is no discernible improvement in the situation this year. Hunger is the main driver that will continue to worsen the situation.”

The interplay of malnutrition and over-nutrition is a double burden that many families, communities and countries in the Arab world have to shoulder. Children under the age of five are particularly affected. In 2020, 20.5 per cent suffered from arrested development and 7.8 from obesity. “Excessive weight among children remains a significant regional public health problem. It exceeds the global average of 5.7 per cent and is 10.7 here,” Elwaer added.

According to the FAO representative, the region not only struggles with child malnutrition, but also adult obesity. The incidence of adult obesity has steadily increased in the region since 2000, reaching 28.8 per cent in 2020. This is more than double the global average of 13.1 and makes the region the third fattest in the world – after North America at 36.7 and Australia and New Zealand at 30.7.

At the same time, a World Bank study reported that economic recovery in the Middle East and North Africa has been sluggish and uneven after nearly two years of pandemic. “The performance of each of the 20 economies in the region will depend on their exposure to oil price volatility and how well they manage the pandemic. The projections for average regional GDP growth of 2.8 per cent in 2021 and 4.2 for 2022 when the pandemic recedes therefore mask differences across countries,” the report says.

The study goes on to say that the 2020/21 global health crisis, in addition to its human toll, has shown the extent to which economic performance depends on pandemic control. “MENA economies are among those paying the price for decades of lack of investment in public health.” In fact, he said, the affected states went into the epidemic overconfident and ill-prepared to deal with it. Vaccination rates would also affect economic recovery. “Again, the outlook is uneven, with richer countries ahead.”

To finance emergency spending on health and social welfare, MENA governments have had to borrow heavily. This has increased government debt. “Average public debt in MENA countries is projected to fall from 56.3 per cent to 53.6, while in oil-importing developing countries it is projected to rise as a share of GDP from 90.4 to 92.3 in 2021 as fiscal deficits remain high,” the World Bank concludes its report.

In parallel, it put the total cost of the pandemic at a maximum of US$227 billion by the end of 2021. Covid-19 worsens long-standing development challenges in the Middle East and North Africa. It increases poverty, worsens public finances, increases vulnerability to debt and further erodes trust in government.

For the near future, the need for further spending and borrowing remains high. MENA countries have no choice but to continue spending on health and social protection as long as the pandemic persists. “Consequently, in a post-pandemic world, most MENA countries could be left with debt service bills that require resources that could otherwise be used for economic development.”

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