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IMF Warns: MENA Region Faces 4 Challenges

International Monetary Fund Managing Director Kristalina Georgieva speaks at a news conference during the World Bank/IMF Spring Meetings at the International Monetary Fund (IMF) headquarters in Washington, Thursday, April 13, 2023. (AP)
International Monetary Fund Managing Director Kristalina Georgieva speaks at a news conference during the World Bank/IMF Spring Meetings at the International Monetary Fund (IMF) headquarters in Washington, Thursday, April 13, 2023. (AP)
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IMF Warns: MENA Region Faces 4 Challenges

International Monetary Fund Managing Director Kristalina Georgieva speaks at a news conference during the World Bank/IMF Spring Meetings at the International Monetary Fund (IMF) headquarters in Washington, Thursday, April 13, 2023. (AP)
International Monetary Fund Managing Director Kristalina Georgieva speaks at a news conference during the World Bank/IMF Spring Meetings at the International Monetary Fund (IMF) headquarters in Washington, Thursday, April 13, 2023. (AP)

Growth of the real GDP in the Middle East and North Africa (MENA) region is projected to slow this year to 3.1 percent from 5.3 percent in the previous year, announced Director of the Middle East and Central Asia Department at the International Monetary Fund (IMF), Jihad Azour.

Azour added that inflation is forecast to remain unchanged at around 15 percent this year before declining modestly in 2024.

In a videoconference attended by Asharq Al-Awsat, Azour explained that the MENA countries face four challenges this year, which are dealing with the effects of inflation, global uncertainty, international financing difficulties, and economic reform developments.

Azour explained that dealing with inflation may require increasing interest rates, which affects economic growth. At the same time, uncertainty and geopolitical tensions pervade all global horizons, and their consequences fall on everyone's shoulders.

Concerning oil-importing countries, the rise in energy prices increases the risks, especially with the increase in the cost of financing and the difficulty in obtaining it. As for the oil-exporting countries, the most critical challenge is growing and diversifying revenues.

Meanwhile, Italian Foreign Minister Antonio Taiani said Thursday that his country wants the IMF to start disbursing a loan to Tunisia without conditions.

During a press conference with his Tunisian counterpart, Tajani vowed to work on Tunisia's behalf in negotiations with the IMF, repeating Italy's proposal that the loan be delivered in two tranches and not be fully dependent on all reforms being in place.

"But not utterly conditional on... the conclusion of the reform process. Start financing, encourage the reforms," he told reporters.

Last week, President Kais Saied rejected IMF "diktats", which asked Tunisia to carry out economic reforms and subsidy cuts as terms for the stalled bailout.

Saeed said he would "not hear diktats" from abroad, warning that the subsidies could lead to unrest.

European leaders feared the collapse of the Tunisian economy could increase the influx of immigrants to European shores.

Tunisia's debts amount to about 80 percent of its gross domestic product, and it reached a preliminary agreement with the Fund in mid-October for a new $1.9 billion loan to help overcome the financial crisis.

However, talks reached a dead end after Tunisia failed to implement a reform program to restructure more than 100 indebted state-owned companies and lift subsidies on some essential goods and services.

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GASTAT: Saudi Consumer Inflation Eased to 1.7% in February

Shoppers are seen at a supermarket in Saudi Arabia. SPA
Shoppers are seen at a supermarket in Saudi Arabia. SPA
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GASTAT: Saudi Consumer Inflation Eased to 1.7% in February

Shoppers are seen at a supermarket in Saudi Arabia. SPA
Shoppers are seen at a supermarket in Saudi Arabia. SPA

Saudi Arabia’s annual inflation rate edged down to 1.7 percent in February, the lowest level since January 2025, according to data from the General Authority for Statistics (GASTAT).

The consumer price index eased from 1.8 percent in January to 1.7 percent, GASTAT said Sunday.

The data further showed that housing, water, electricity, gas, and other fuels rose 4.1 percent in February 2026, mainly driven by a 5.1 percent increase in actual housing rents.

Transport prices also climbed 1.4 percent, supported by a 5.6 percent rise in passenger transport services, while restaurant and accommodation services increased 1.9 percent due to higher accommodation costs.

Personal care, social protection and miscellaneous goods and services surged 8.2 percent, largely reflecting a jump in other personal effects, particularly jewelry and watch prices, which rose 29 percent.

According to GASTAT, prices in recreation, sport and culture climbed 1.8 percent, while education services increased 1.4 percent. As for information and communications prices, they edged up 1.1 percent.

Data showed that prices in the insurance and financial services category rose 1 percent.

As for furnishings, household equipment and routine maintenance, prices declined 0.9 percent, while prices for food and beverages, as well as clothing and footwear, remained largely stable during the period.

GASTAT said that on a monthly basis, the Consumer Price Index last month recorded relative stability compared to January 2026.

Business

Oil Hovers around $100, Stocks Mixed as Iran War Rages

An oil pump is pictured at an obsolete oilfield, with wind turbines in the background, in Sargentes de la Lora on March 13, 2026, near Burgos in northern Spain, where oil first flowed in Spain in 1964. (Photo by CESAR MANSO / AFP)
An oil pump is pictured at an obsolete oilfield, with wind turbines in the background, in Sargentes de la Lora on March 13, 2026, near Burgos in northern Spain, where oil first flowed in Spain in 1964. (Photo by CESAR MANSO / AFP)
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Oil Hovers around $100, Stocks Mixed as Iran War Rages

An oil pump is pictured at an obsolete oilfield, with wind turbines in the background, in Sargentes de la Lora on March 13, 2026, near Burgos in northern Spain, where oil first flowed in Spain in 1964. (Photo by CESAR MANSO / AFP)
An oil pump is pictured at an obsolete oilfield, with wind turbines in the background, in Sargentes de la Lora on March 13, 2026, near Burgos in northern Spain, where oil first flowed in Spain in 1964. (Photo by CESAR MANSO / AFP)

Oil prices hovered around $100 a barrel Monday and stocks fluctuated as the Iran war moved into a third week with both sides showing no sign of backing down and diplomats trying to ensure safe passage for tankers through the crucial Strait of Hormuz.

Crude shot up in the opening minutes after the US president said at the weekend that forces struck military targets on Kharg Island, a scrubby stretch of land in the Gulf that handles almost all of Iran's oil exports.

He also warned attacks could expand to energy infrastructure if the Iranian republic interferes with transit through Hormuz, which has been effectively closed since the US-Israel operations began on February 28.

Iran's Fars news agency reported soon after that no oil infrastructure was damaged in strikes.

Trump urged other countries to send warships to keep the waterway open but offered no specifics or commitments from the US side, saying he hoped China, France, Japan, South Korea and the UK would take part.

He later wrote Saturday in a Truth Social post: "The Countries of the World that receive Oil through the Hormuz Strait must take care of that passage, and we will help -- A LOT!

"This should have always been a team effort, and now it will be."

However, Japan said Monday it was "not at the moment considering issuing a maritime security operation", while Australia announced it would not send any navy ships to the region.

Trump said Tehran wanted a deal to end the fighting, but that he was not prepared to make one on current terms, without giving further details.

Iran's Foreign Minister Abbas Araghchi said his country was not interested in talks with Washington.

"We don't see any reason why we should talk with Americans, because we were talking with them when they decided to attack us," he told CBS's "Face The Nation" in an interview aired Sunday.

"There is no good experience talking with Americans," adding that "we never asked for a ceasefire, and we have never asked even for negotiation".

However, he did say he was ready to speak to countries "who want to talk to us about the safe passage of their vessels".

"I cannot mention any country in particular, but we have been approached by a number of countries" seeking such safe passage, he added.

Meanwhile, traders hoping for an early end to the conflict were left disappointed after Trump's top economics adviser Kevin Hassett said the Pentagon estimates it could take up to six weeks, though the operation was ahead of schedule.

Both main crude contracts advanced. Brent shot up around three percent to as high as $106.50 before paring the gains, while West Texas Intermediate sat around $99.

And with worries growing about a possible energy crisis that could hammer the global economy, equity markets remained under pressure.

Tokyo, Shanghai, Sydney, Seoul, Wellington, Manila and Jakarta were all down, though Hong Kong, Singapore and Taipei edged up.

"Equities may welcome any sign that Hormuz could be reopened, but with further strikes still being threatened and diplomacy still patchy, conviction is low," said Charu Chanana at Saxo Markets.

Adding to economic concerns was data showing Friday that fourth-quarter US gross domestic product expanded 0.7 percent, much slower than the initial reading of 1.4 percent.

And delayed figures showed the Federal Reserve's preferred inflation gauge dipped to 2.8 percent in January before energy prices shot higher.

"Developments over the weekend, while no more disconcerting than at the end of last week, don't offer any obvious pretext for a less pessimistic start to the new trading week," warned National Australia Bank's Ray Attrill.

Also in view this week are policy meetings at seven major central banks including the Fed, Bank of England and the European Central Bank.

While they are expected to stand pat on interest rates, any remarks on the impact of the war on their respective economies will be closely followed.

Business

Bahrain Starts to Cut Production at World’s Largest Aluminium Smelter

A worker walks past the storage of aluminium ingots at the aluminum smelter Aluminium Dunkerque in Loon-Plage near Dunkirk, France, September 22, 2022. REUTERS/Pascal Rossignol
A worker walks past the storage of aluminium ingots at the aluminum smelter Aluminium Dunkerque in Loon-Plage near Dunkirk, France, September 22, 2022. REUTERS/Pascal Rossignol
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Bahrain Starts to Cut Production at World’s Largest Aluminium Smelter

A worker walks past the storage of aluminium ingots at the aluminum smelter Aluminium Dunkerque in Loon-Plage near Dunkirk, France, September 22, 2022. REUTERS/Pascal Rossignol
A worker walks past the storage of aluminium ingots at the aluminum smelter Aluminium Dunkerque in Loon-Plage near Dunkirk, France, September 22, 2022. REUTERS/Pascal Rossignol

Aluminium Bahrain, known as Alba, said on Sunday it had initiated a shutdown of three aluminium smelting lines accounting for 19% of its capacity to preserve business continuity amid ongoing disruption in the Strait of Hormuz.

The closures are the latest impact on the Middle East aluminium sector, which accounts for around 9% ⁠of global supply, from the US-Israeli war on Iran, according to Reuters.

Fears of shortages propelled London Metal Exchange aluminium to a nearly four-year high of $3,546.50 per metric ton on Thursday.

Alba, which has smelting capacity of 1.62 million tons of aluminium per year, said in a statement it had initiated a “controlled and safe shutdown” of reduction lines 1, 2 and 3.

“This targeted, line-specific action is designed to optimize the utilization of Alba's existing raw materials inventory and prioritize operational stability across Reduction Lines 4, 5 and 6,” added ⁠Alba, which describes itself as the “world's largest aluminium smelter on one site.”

The company had issued force majeure on March 4 since it was unable to ship metal to customers due to the effective closure of the Strait of Hormuz.

The closure has also left Middle East ⁠smelters unable to bring in vessels carrying their key raw material, alumina.

Energy supply is another issue for smelters.

Qatar's Qatalum had begun a shutdown on March 3 due to a suspension of its ⁠gas supply but will now operate at 60% capacity.

Alba, meanwhile, said it would use the opportunity to undertake asset care and maintenance on the three shuttered lines, including ⁠comprehensive housekeeping and cleaning activities, laying the foundations for a safe restart when conditions improve.

“The company is also working closely with suppliers and customers to manage commitments and mitigate disruption,” it added.