Arab Economies Incurred $1.2 Trillion Losses Due to Coronavirus

Shoppers are seen in an aisle with subsidized vegetable oils at a government outlet in Cairo, Egypt August 29, 2017. REUTERS/Mohamed Abd El Ghany

The novel coronavirus pandemic had a harsh economic impact on the Arab economy, with total losses so far amounting to about $1.2 trillion, amid expectations that some 7.1 million workers will lose their jobs.

Those numbers were emphasized in a report issued by the Arab League, which called for the establishment of a crisis fund that could alleviate the repercussions of the force majeure.

The report, which was prepared by the League’s economic affairs department, shed light on the short and long term repercussions of the virus and their impact on the sectors of health, agriculture, food and development

The report detailed the losses as follows: $420 billion in market capital, $63 billion in the GDP of member countries, additional debts of $220 billion, and a daily loss of $550 million in oil revenues, in addition to a decline in exports of $28 billion, more than $2 billion in tariff revenues and loss of about 7.1 million jobs in 2020

The report said that, according to a preliminary evaluation conducted by the International Labor Organization (ILO), the COVID-19 pandemic will have a major impact on labor markets around the world with the soaring unemployment rate.

It added that the health care and food security sectors would be affected the most by the crisis, as well as the industries of oil, tourism and air transport.

The report examined the short-term repercussions in the Arab world, stating: “Although the situation in the Arab countries is much better compared to the United States, the European Union and China, most countries resorted to precautionary measures to contain the virus… leading to huge losses in the aviation and tourism sectors and the loss of about one million employments and hundreds of thousands of seasonal jobs, in addition to the sharp decline in oil prices.”

The report presented a number of proposals, including the establishment of an Arab fund for crises and reviewing the requirements for providing financial support to member-states, by setting more flexible temporary conditions, and postponing outstanding installments during this exceptional period.