IMF: Israel-Hamas War Will Impact Economies of Egypt, Lebanon, Jordan 

International Monetary Fund (IMF) Managing Director Kristalina Georgieva attends a signing ceremony with Thailand to host the 2026 International Monetary Fund and the World Bank annual meetings on the last day of the International Monetary Fund and the World Bank, following last month's deadly earthquake, in Marrakech, Morocco, October 15, 2023. (Reuters)
International Monetary Fund (IMF) Managing Director Kristalina Georgieva attends a signing ceremony with Thailand to host the 2026 International Monetary Fund and the World Bank annual meetings on the last day of the International Monetary Fund and the World Bank, following last month's deadly earthquake, in Marrakech, Morocco, October 15, 2023. (Reuters)
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IMF: Israel-Hamas War Will Impact Economies of Egypt, Lebanon, Jordan 

International Monetary Fund (IMF) Managing Director Kristalina Georgieva attends a signing ceremony with Thailand to host the 2026 International Monetary Fund and the World Bank annual meetings on the last day of the International Monetary Fund and the World Bank, following last month's deadly earthquake, in Marrakech, Morocco, October 15, 2023. (Reuters)
International Monetary Fund (IMF) Managing Director Kristalina Georgieva attends a signing ceremony with Thailand to host the 2026 International Monetary Fund and the World Bank annual meetings on the last day of the International Monetary Fund and the World Bank, following last month's deadly earthquake, in Marrakech, Morocco, October 15, 2023. (Reuters)

The raging war between Israel and Hamas is already battering the economies of nearby countries, the managing director of the International Monetary Fund told a Saudi investor forum on Wednesday.

"You look at the neighboring countries -- Egypt, Lebanon, Jordan -- there the channels of impact are already visible," Kristalina Georgieva said at the Future Investment Initiative (FII) in the Saudi capital Riyadh.

The Palestinian militant group Hamas staged a shock attack on Israel on October 7, killing more than 1,400 people and taking 222 hostages, according to Israeli authorities.

Israel has responded with withering air strikes and a near-total land, sea and air blockade of Gaza, where the Hamas-run health ministry says 5,791 people have been killed in the war so far.

Georgieva spoke one day after Wall Street titans told the forum that the war could deal a heavy blow to the global economy, especially if it draws in other countries.

"What we see is more jitters in what has already been an anxious world," Georgieva said.

"You have tourism-dependent countries -- uncertainty is a killer for tourist inflows," she said, describing the potential economic cost for countries in the region before listing specific risks.

"Investors are going to be shy to go to that place. Cost of insurance -- if you want to move goods, they go up. Risks of even more refugees in countries that are already accepting more."



Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
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Saudi Arabia's Digital Advertising Boom: Addressing Economic Leakage, Boosting Local Content

A digital advertising event recently held in Riyadh (Asharq Al-Awsat)
A digital advertising event recently held in Riyadh (Asharq Al-Awsat)

Saudi Arabia’s digital advertising sector is experiencing rapid growth, but a significant portion of its revenues is leaking to foreign platforms. To maximize the impact on the national economy, experts are calling for strategies to curb this outflow and redirect it to local channels.

The importance of retaining digital ad revenues lies in the substantial size of this market. It is estimated that approximately $1 billion in ad spent is lost annually to foreign platforms, representing a considerable loss to Saudi Arabia’s economy.

Dr. Ebada Al-Abbad, CEO of Marketing and Communications at Tadafuq, a Saudi digital advertising network, told Asharq Al-Awsat that the problem stems from the fact that although advertisers, products, and audiences are often local, the largest share of financial gains goes to foreign platforms. He estimated that 70-80% of the $1.5 billion spent on digital advertising in Saudi Arabia in 2022 went to global platforms such as Google and Facebook. This results in the national economy losing nearly $1 billion annually from this sector alone.

Al-Abbad noted that government agencies in Saudi Arabia also contribute to the outflow. He explained that public sector spending on digital advertising, intended to raise awareness among citizens and residents, frequently ends up on foreign platforms. Government spending makes up about 20-25% of the total digital ad market in the Kingdom, meaning hundreds of millions of riyals leave the country annually, weakening the local digital economy.

Al-Abbad argues that Saudi Arabia needs strong local digital ad networks to keep this revenue within the national economy. These networks would help create jobs, drive innovation, and promote cultural diversity in digital content. Developing local platforms would also enhance Saudi Arabia’s digital sovereignty by ensuring that data remains within the country and is not controlled by foreign entities.

Moreover, local networks would reduce dependence on international platforms, ensuring that the economic benefits of digital advertising remain in the Kingdom, he said, stressing that this would align with Saudi Arabia’s broader Vision 2030 goals, which emphasize building a robust, diversified economy driven by local industries and digital transformation.

Globally, the digital advertising sector is growing rapidly. In 2022, worldwide spending on digital ads reached $602 billion, and it is projected to hit $876 billion by 2026. In the Middle East and North Africa (MENA) region, the digital ad market grew to $5.9 billion in 2022, with Saudi Arabia’s market accounting for over $1.5 billion.

In other countries, the digital ad sector plays a crucial role in boosting national economies. For example, in the United States, the digital advertising industry contributed $460 billion to the GDP in 2021, about 2.1% of the total. In the UK, the sector accounted for 1.8% of GDP in 2022. This shows how important digital advertising can be in driving economic growth.

One of the key challenges facing Saudi Arabia’s digital ad sector is the dominance of global platforms like Google and Facebook, which control 60% of the global digital ad market, Al-Abbad told Asharq Al-Awsat. This dominance results in a significant outflow of revenue and allows these platforms to control digital data and content. He warned that this could undermine Saudi Arabia’s national sovereignty over its digital economy.

To counter this, he emphasized that Saudi Arabia needs to build competitive local networks that can retain a larger share of the market. This will not only keep more revenue in the country but also strengthen the Kingdom’s control over its digital data and content.