‘Expected regional growth to reflect on Jordan’

AMMAN — The expected regional growth rebound to 3.7 per cent in 2016-2017 is likely to boost investments in some oil importing countries such as Egypt and Jordan, says the World Bank (WB) Group’s latest Global Economic Prospects  report, released this week.

However, projections for this year are still low as the report, which highlights global economic prospects, says 2015 will be a challenging year, mainly for developing countries.  

Developing countries face a series of tough challenges in 2015, including the looming prospect of higher borrowing costs as they adapt to a new era of low prices for oil and other key commodities, resulting in a fourth consecutive year of disappointing economic growth this year, the report said. 

As a result, developing countries are now projected to grow by 4.4 per cent this year, with a likely rise to 5.2 per cent in 2016 and 5.4 per cent in 2017.

In the Middle East and North Africa, growth is expected to remain flat at 2.2 per cent in 2015, according to the WB Group report.

The plunge in oil prices is a particular challenge for oil-exporting countries, most of which also have severe security challenges, as is the case in Iraq, Libya and Yemen, or are facing limited economic cushioning as in Iran and Iraq. 

Long-standing structural constraints present a chronic obstacle to faster growth in the region, the report said. 

“After four years of disappointing performance, growth in developing countries is still struggling to gain momentum,” said Franziska Ohnsorge, lead author of the report. 

“Despite auspicious financing conditions, a protracted slowdown has been under way in many developing countries, driven by shortages in agriculture, power, transport, infrastructure and other vital economic services. This makes the case for structural reforms all the more urgent,” he noted.