DUBAI – The coronavirus pandemic has pushed nearly all Mideast nations into the throes of an economic recession this year, yet some rebound is expected as all but two — Lebanon and Oman — are anticipated to see some level of economic growth next year, according to a report published Monday by the International Monetary Fund.
This comes as the IMF estimates that the global economy will shrink 4.4% this year, marking the worst annual plunge since the Great Depression of the 1930s.
Well before the coronavirus swept across the globe, several Mideast countries had been struggling with issues ranging from lower oil prices and sluggish economic growth to corruption and high unemployment.
The IMF projects the Lebanese economy will see one of the region's sharpest economic contractions this year at 25%. The pandemic has only pushed the country further to the brink after a wave of anti-government anger before the virus struck.
Lebanese demonstrators were protesting government corruption, foreign exchange shortages, hyperinflation, constant electricity cuts and increasing poverty. The currency has dropped by 70% compared to the end of last year, with people struggling to afford basic goods. A devastating explosion at Beirut's main port in August killed at least 180 people, injured more than 6,000 and destroyed entire neighborhoods. The blast left hundreds of thousands of people homeless.
While Mideast nations have seen fewer confirmed cases and deaths from the virus than countries in Europe and the U.S., the region still faces challenges in containing the disease.
“Risks of a worse-than-projected scenario loom large, particularly given recent surges in COVID-19 infections in many countries around the world that have reopened,” the IMF warned.
Iran, for example, recorded its highest daily death tolls from the virus last week. Its economy shrank by 6.5% last year and is projected to contract by another 5% this year. The IMF, however, expects Iran's economy to rebound with 3.2% growth next year, based in part on the government's future capacity to manage the virus, which it thus far as has struggled to do.