Here's how MENA economies will perform in 2018-19

The economic recovery in the Middle East and North Africa (MENA) region will be stronger than most anticipate over the coming quarters, Capital Economics said in a new report.

"While our forecasts for the MENA region as a whole in 2018-19 lie above the consensus, we think that growth will start to falter in 2020," it added.

Argaam has compiled an outlook below:

1)  Saudi Arabia’s economy emerged from recession at the start of this year. The recovery is set to gather momentum as oil output rises and the government loosens fiscal policy.

2) Growth in Egypt will pick up over the coming years. Inflation and interest rates are likely to fall by more than most anticipate as the pace of fiscal consolidation looks set to slow.

3) The UAE’s economy is expected to strengthen. Growth in the oil sector will accelerate in the coming months, while preparations for the 2020 World Expo are being stepped up.

4) Morocco’s economy will slow this year, but a rebound is likely in 2019-20. The country’s integration into European manufacturing supply chains means that long-term prospects are bright.

5) Rising oil output will support robust GDP growth in Kuwait this year and next. But growth in its non-oil sector is likely to remain sluggish.

6) Fragile balance sheets cloud the outlook for Bahrain and Oman. Financial support from the rest of the Gulf will keep dollar pegs intact, but fiscal austerity will be stepped up and growth will be weaker than most expect. 

7) Balance sheets are also weak in Lebanon and Jordan. Growth will be sluggish over the coming years and the risks in both countries lie to the downside.

8) Strains in the balance of payments will weigh on Algeria and Tunisia. Currencies are likely to fall further and GDP growth will disappoint.