- Shamshad Akhtar’s Talk Identifies Key Hurdles to Region’s Post-Crisis Development
The Middle East and North Africa (MENA) region needs to address critical long-term development challenges, even though it may have surmounted the worst-ever
“Triple F” (food, fuel and financial) crisis in recent memory, according to Dr. Shamshad Akhtar, Vice-President (MENA), World Bank.
Dr. Akhtar’s remars came during her lecture on “The Middle East After the Crisis,” hosted by the Dubai School of Government, a research and teaching institution focusing on public policy in the Arab world. Senior government officials, students and other professionals attended the event.
Speaking on the impact of the “Triple F” crisis, Akhtar elaborated on the post-crisis development challenges the region needs to focus on, including the creation of productive private sector jobs for a growing labor force and the management of scarce resources, including water. She also shared insights on the World Bank Group’s initiatives to combat the impact of the crisis.
According to Akhtar, the impact of the crisis on a country depends on its exposure to affected markets or commodities, as well as on its macroeconomic conditions and policies. Resource-rich countries within the MENA region which were dependent on one or two commodities for their economic growth exhibited a higher level of vulnerability and experienced a sharper slowdown. Citing examples of countries which didn’t follow this pattern, and have hence continued to grow through the crisis, she lauded Qatar, Tunisia and Morocco for their investments in a diversified portfolio of industries.
Shamshad Akhtar said: “The crisis has generated multiple social implications; in particular, recent ILO estimates indicate that unemployment has risen by 25 percent in the GCC and 13 percent in North Africa, compared to 2007. Empirical evidence indicates that a vibrant private sector is critical for efficient and effective employment generation. In this context, the World Bank is encouraging development of a more inclusive private sector enabling environment.
“What is encouraging, though, is the results of the World Bank’s ‘Doing Business’ survey, which indicates that Egypt and the UAE have been the top global reformers. Eventually, a vibrant private sector, with investments in small and medium enterprise (SME) development and focusing on promoting the employability of youth through quality education and skill development, will help in bridging the gap between labor supply and demand.”
Ms. Akhtar highlighted “The World Bank has implemented several key steps in response to the crisis. These include broadening the analytical and technical advisory teams and directing the flow of its disbursing transactions towards supporting structural reforms to achieve improved access to development finance, infrastructure development and building social safety nets. Cumulatively, the World Bank is to provide over $5 billion or so during June 2008-June 2010, of which half has already been disbursed. It is expected that about half of the assistance to be disbursed during the current fiscal year will be to support structural reforms in the crisis-affected economies. These will not only provide required financial support, but will also alleviate policy constraints impeding economic growth.”
Dr. Tarik Yousef, Dean of the Dubai School of Government, said: “Today’s lecture has provided us with valuable insight into the approach of the World Bank Group in dealing with the impact of the food, fuel and financial crises within the MENA region. Dr. Shamshad Akhtar’s account of the steps being taken to resuscitate the region’s economic environment has been informative and realistic, identifying the challenges that we must face to emerge from such crises.”
Shamshad Akhtar has served as Governor of the State Bank of Pakistan (2006-2009), a federal ministerial-level ranking. During this period, she was also a Governor of the International Monetary Fund (IMF). In 2006 and 2007 she was nominated Asia’s Best Central Bank Governor by Emerging Markets and the Banker’s Trust.
She is the recipient of a post-doctoral fellowship from Harvard University, and holds a post-graduate degree in Development Economics from the University of Sussex, as well as an M.Sc. in Economics from the Quaid-e-Azam University, Islamabad, Pakistan.
Established in 2005 in cooperation with the Harvard Kennedy School, the Dubai School of Government is committed to the creation of knowledge and the dissemination of global best practices in the Arab world. The School conducts various programs that seek to enhance the region’s capacity for effective public policies.
For more details, visit
www.dsg.ae or call 04 329 3290.
