Economics & business in the Middle East
Diversification from fossil-fuel dependence faces immediate and long-term challenges.
With Washington’s departure from the nuclear deal, Iran can no longer hope for a return to the international financial system and an influx of Western investment: its major challenge will be to keep up oil exports. Higher oil prices will put fiscal pressure on regional oil importers; exporters will also face an ongoing structural reform imperative. However, further cuts in expenditure, reduction of subsidies and attempts to raise new taxes will only increase social tensions. Saudi Arabia's crown prince is proceeding apace with his social reform and economic diversification programme, but it has left traditionalists and the private sector, on which success will ultimately depend, reeling.
- Will the other Gulf Arab monarchies follow Saudi Arabia in economic reform?
- Can Iran juggle its complex foreign economic relations to stave off growing domestic economic unrest?
- Will social safety nets set up to offset subsidy cuts in countries such as Egypt work?
- How well will the Syrian and Iraqi governments kick-start reconstruction after years of civil war?
Senior lecturer in International Political EconomyRegent’s University London
Middle East Region HeadOxford Analytica
Associate Fellow, Middle East & North Africa ProgrammeChatham House
Director of the Geo-economics and Strategy Program (GESP)International Institute for Strategic Studies (IISS)