aman union conference · 2013-12-04 · aman union conference middle east and north africa ......
TRANSCRIPT
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Aman Union Conference
Middle East and North AfricaMacroeconomic Outlook
Ed ward Coughlan – Head of Middle East AnalysisBusiness Monitor International
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Presentation Agenda
I. BMI Methodology
II. Outlook for the GCC
III. Outlook for North Africa
IV. Focus on ‘Crisis’ States
V. Q&A
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Presentation Agenda
I. BMI Methodology
II. Outlook for the GCC
III. Outlook for North Africa
IV. Focus on ‘Crisis’ States
I. Q&A
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Who We Are
• Established in 1984
• We are a leading source of market intelligence encompassing macroeconomic, political risk, financial markets and industry research worldwide
• Emerging and frontier markets specialists
• Headquartered in London, with regional offices in Singapore, Johannesburg and New York
• Over 120 research analysts worldwide
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Methodology
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Methodology
Country Risk Methodology
MACROECONOMIC FORECASTING
• Our forecasting methodology is based on ‘Total Analysis’: the integration of multiple variables including macro indicators, political risk, financial markets and sectors outlooks
• We use publicly available data sources, prioritising national level sources
• We have an econometric model (OEF) but we use this more for benchmarking as opposed to defining our forecasts
• Indeed, we believe in ‘analyst intervention’, taking cues from markets, politics and global/regional and micro trends
FINANCIAL MARKETS FORECASTING
• As with everything, our FM methodology reflects ‘Total Analysis’, integrating our macro, political risk and sectors research
• We also integrate fundamental with technical analysis
POLITICAL RISK ANALYSIS• Analysts produce comprehensive domestic political outlooks, supported by Head of Region and
Head of Political Risk
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Presentation Agenda
I. BMI Methodology
II. Outlook for the GCC
III. Outlook for North Africa
IV. Focus on ‘Crisis’ States
V. Q&A
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Middle East & North Africa
Gulf: Public spending to remain elevated as governments seek to placate potential domestic opposition.
Growth Rates To Converge Across Region: Lower oil prices and base effects will see similar growth rates across MENA.
MENA Macroeconomic Outlook: Positive outlook in most states, though partly due to base effects. Political & security issues to limit growth in much of Middle East. Favourable demographics and increased government spending to boost private consumption.
Little Hope For 'Crisis States': We do not expect a resolution to crises in Syria and Iran. Similarly, Yemen and Libya will remain very unstable both politically and economically.
North Africa: Inflation to head broadly lower on the back of cheaper food imports in H213.
Key Risk – Subsidies: North African governments require subsidy reform to meet IMF demands and reduce budget deficits.
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Middle East & North Africa
GCC – Real Growth Rates (%)
Remain positive on GCC outlook
Growth will slow and converge
Non-oil sector to drive growth
Kuwait to lag
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Middle East & North Africa
GCC - Fiscal Account, % of GDP
Lower oil prices will worsen fiscal outlook
Less room for fiscal expansion
Qatar and Kuwait best placed
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Middle East & North Africa
Incremental Oil Production (‘000 bbl)Limited growth in exports
Saudi to remain key swing producer
Libya and Iraq to record highest growth rates
Substantial risks of outages
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Middle East & North Africa
GCC House Price Inflation % chg y-o-y
Housing to act as principal source of inflation
Tightening supply, no delivery of new housing
Divergence in UAE – Dubai to outperform Abu Dhabi
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Middle East & North Africa
Reliance On Hydrocarbon Revenues, 2012
Diversification to become ever more important
Saudi Arabia best placed for industrial base
Kuwait could be left behind
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Middle East & North Africa
GCC Ratings
Kuwait’s uncompetitivenessa major concern
Localisation policies to worsen business environment
Substantial impact on remittances
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Middle East & North Africa
I. BMI Methodology
II. Outlook for the GCC
III. Outlook for North Africa
IV. Focus on ‘Crisis’ States
V. Q&A
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Middle East & North Africa
Real GDP Growth, % chg y-o-y
Libya to enjoy fastest growth rates
Worst is over for Egypt
Political risks to remain elevated
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Middle East & North Africa
MENA – Budget Deficits, % of GDP
Subsidy reform vital
Political motives to outweigh economic imperatives
Lower oil prices would alleviate some pressures
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Middle East & North Africa
I. BMI Methodology
II. Outlook for the GCC
III. Outlook for North Africa
IV. Focus on ‘Crisis’ States
V. Q&A
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Middle East & North Africa
BMI’s Proprietary Political Risk Ratings
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Middle East & North Africa
Dubai Exports
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Middle East & North Africa
Q&A