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Growth halves for Middle Eastern economies

Growth halves for Middle Eastern economies article image

The International Monetary Fund (IMF) has predicted that economic growth in the Middle East will halve due to the flow on effects of the global financial crisis lowering the demand and price of oil. In its Regional Economic Outlook, the IMF has encouraged governments in the region to boost their spending to stimulate their respective economies. The oil-producing nations of Saudi Arabia, the United Arab Emirates and Kuwait are particularly vulnerable to contraction after oil prices fell to US$90 from almost US$150 in July 2008. The IMF added that restricted credit will also affect the region: "The tightening of international credit markets and lower investor appetite for risk is affecting capital inflows, depressing asset prices and reducing investments in these countries." The report forecast overall regional growth at 2.6 percent this year, down from 5.7 percent in 2008.

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