Bericht

Transition in the MENA Region: Challenges, Opportunities and Prospects

This paper discusses the transition agenda and provides the key economic characteristics of selected Middle East and North Africa countries (MENA) in comparison with selected Central, East and Southeast European countries (CESEE). We intend to identify some regularities in transition processes and to draw policy lessons for MENA countries. Among the key challenges facing the MENA region are job creation, fighting corruption, public sector reforms and trade diversification; the way towards a functioning market economy should not necessarily be as long and controversial as in the CESEE. MENA countries had been implementing market-oriented reforms for more than a decade. Together with free trade agreements concluded with the EU, these reforms have contributed to an increase of FDI inflows. Still, MENA countries have been lagging behind in terms of export performance, competitiveness and restructuring. Numerous impediments to trade and FDI in the MENA region need to be overcome, yet the transition will not require a radical overhaul of the existing system. The sine qua non condition is to achieve high per capita GDP growth. There is no guarantee for success – as illustrated by the experience of CESEE. Moreover, the current global crisis makes policy implementation not easier. If anything, future scenarios must reckon with a slow process of improvements and many backlashes. Transitions and sustainable reforms need to be anchored in a supportive international environment. In the case of many CESEE countries, the EU provided such an anchor. In the case of MENA, such a strong anchor is missing. A newly designed international involvement and especially the strengthened role of the EU will play a crucial role. A comprehensive EU-MENA trade agreement, possibly with an intra-MENA (and Turkey) Customs Union arrangement, would be beneficial to both MENA and the EU.

Language
Englisch

Bibliographic citation
Series: wiiw Research Report ; No. 376

Classification
Wirtschaft
Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
Trade Policy; International Trade Organizations
International Agreements and Observance; International Organizations
Institutions and Growth
Comparative Studies of Countries
Comparative Studies of Particular Economies
Subject
transition
integration
foreign trade
FDI
labour market

Event
Geistige Schöpfung
(who)
Gligorov, Vladimir
Havlik, Peter
Richter, Sandor
Vidovic, Hermine
Event
Veröffentlichung
(who)
The Vienna Institute for International Economic Studies (wiiw)
(where)
Vienna
(when)
2012

Handle
Last update
10.03.2025, 11:42 AM CET

Data provider

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Object type

  • Bericht

Associated

  • Gligorov, Vladimir
  • Havlik, Peter
  • Richter, Sandor
  • Vidovic, Hermine
  • The Vienna Institute for International Economic Studies (wiiw)

Time of origin

  • 2012

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