World Bank Urges Region’s States to Turn Climate, Tech Challenges into Opportunities

A citizen participates in the “Saudi Green Initiative” (SPA)
A citizen participates in the “Saudi Green Initiative” (SPA)
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World Bank Urges Region’s States to Turn Climate, Tech Challenges into Opportunities

A citizen participates in the “Saudi Green Initiative” (SPA)
A citizen participates in the “Saudi Green Initiative” (SPA)

The World Bank has warned that countries in the Middle East and North Africa (MENA) face a critical crossroads, requiring “urgent” reforms to turn major challenges, aging populations, climate change, and technological transformation, into real opportunities that can secure sustainable growth for future generations.

At the same time, the Bank highlighted Saudi Arabia’s coordinated reforms under its Vision 2030, which have raised women’s workforce participation from 17% in 2016 to over 35% in 2024.

In an interview with Asharq Al-Awsat, Fadia Saadah, World Bank Regional Director for Human Development in the Middle East, North Africa, Afghanistan, and Pakistan, outlined the Bank’s view on the most pressing reforms and how Gulf Cooperation Council (GCC) countries can leverage significant investments in human capital to close gaps and boost inclusive economic participation.

Developing Skills

Saadah noted that GCC countries, including Saudi Arabia, are seeking to maximize the benefits of foreign labor through labor market policy reforms, balancing the need to fill skills gaps with supporting economic growth, while investing in education, skill development, and incentives to encourage citizens’ participation in the private sector.

She highlighted Saudi Arabia’s extensive reforms in recent years to improve its sponsorship (kafala) system, enhancing the mobility of foreign workers and improving working conditions.

These reforms have been paired with Saudization programs, such as Nitaqat, which set quotas for employing Saudi nationals in the private sector.

According to Saadah, these measures—alongside financial support programs, retraining initiatives, and women’s empowerment policies—have contributed to increased citizen participation, particularly among women. Digital platforms and targeted training programs have also supported citizens, especially youth and women, by providing access to employment opportunities and developing skills required for a changing labor market.

Digital Transformation and Vision 2030

Under Vision 2030 and government digital initiatives, Saadah said Saudi Arabia has prioritized digital services, data-driven decision-making, and inclusive access, focusing on women and youth as central to the digital transformation. The kingdom is investing in digital infrastructure and artificial intelligence to modernize public service delivery and expand economic opportunities.

While human capital in the region has improved significantly, Saadah cautioned that its full potential remains untapped for driving economic growth. Despite progress in education and healthcare, aging populations and unhealthy lifestyle patterns continue to strain pension systems and healthcare infrastructure. Conversely, climate challenges and technological shifts offer opportunities to enhance green skills and digital readiness, opening new avenues for sustainable growth.

Institutional Reforms Needed

In its mid-September report, Embracing and Shaping Change: Human Development in MENA in a Transforming Phase, the World Bank noted that low human development investment is both a cause and consequence of economic performance and income growth. The report urged governments in the region to address governance gaps and ensure sustainable financing for human development.

The report identified three major trends that could erode development gains if not effectively addressed:

Aging populations: With the share of older adults expected to double by 2050, pension and healthcare systems face major challenges.

Climate crisis: Rising temperatures and water scarcity threaten health and food security, though green transition policies could create new opportunities.

Technological transformation: Although regional labor markets are less exposed to automation than elsewhere, the region must prepare to fully benefit from artificial intelligence, improve digital infrastructure, and reduce internet costs.

Saadah emphasized that building on these achievements requires continued investment in future-ready human development policies, including strengthening human capital, advancing institutional reforms, and adopting strategies tailored to each country.

Women’s Empowerment

Saadah said Saudi Arabia offers a clear example of achieving better outcomes through broad reform programs. Vision 2030, labor market strategy, and human capacity development initiatives have aligned education and skills development with labor market needs.

Efforts focus on technical and vocational education, digital skills, and lifelong learning to enhance private sector employment opportunities, particularly for youth and women. Digital platforms such as Qawi and Jadarat have facilitated access to jobs and training programs, improved labor market matching, supported flexible and remote work, and developed future-ready skills, making the labor market more inclusive and responsive.

Reforms have also included removing guardianship requirements for women to work or travel, criminalizing workplace harassment, unifying retirement ages, and banning gender discrimination in hiring and pay. Complementary support programs, such as Wasl for transportation, Qara for childcare, and Maran for workplace flexibility, along with training in nontraditional sectors like ICT and aviation, have further empowered women.

Saadah concluded that these measures have enabled women to enter and remain in the workforce, especially in the private sector, contributing to shifts in social attitudes and broader acceptance of women’s economic participation. She stressed that enhancing women’s participation is not merely a social choice but an economic strategy, as reforming social norms and official institutions is essential for achieving a sustainable and deeply impactful transformation.



IMF: Middle East Faces Pivotal Economic Moment

Azour speaks during a presentation of the Regional Economic Outlook update (AFP)
Azour speaks during a presentation of the Regional Economic Outlook update (AFP)
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IMF: Middle East Faces Pivotal Economic Moment

Azour speaks during a presentation of the Regional Economic Outlook update (AFP)
Azour speaks during a presentation of the Regional Economic Outlook update (AFP)

The International Monetary Fund said the Middle East, North Africa, and Pakistan were facing a pivotal and exceptionally difficult moment in their modern economic history after the war that broke out on Feb. 28, 2026, describing it as a severe and multifaceted shock to one of the world’s most strategically important economic corridors.

The IMF said the conflict was not merely a border crisis but had disrupted “three pillars of stability, energy markets, trade routes, and business confidence,” triggering a global energy shock and weakening supply chains.

Amid these challenges, Saudi Arabia’s economy emerged as a model of resilience, showing what the IMF described as “exceptional sturdiness” that enabled it to absorb the impact of disruptions to the Strait of Hormuz and a decline in regional output, supported by the pillars of Vision 2030, which strengthened fiscal discipline and logistical flexibility.

Jihad Azour, director of the IMF’s Middle East and Central Asia Department, said while presenting an update of the Regional Economic Outlook in Washington, on the sidelines of the IMF and World Bank Spring Meetings, that the war was reshaping the region’s economic outlook.

At the center of the shock was energy, he said, noting that the Strait of Hormuz, “the world’s most critical energy chokepoint, through which roughly one-fifth of global oil supply and about one-quarter of global LNG trade normally transit,” had come close to a standstill.

He said disruptions and shutdowns had cut oil and gas output across Gulf Cooperation Council countries, pushing Brent crude above $100 a barrel, while “European gas prices rose by roughly 60 percent, exceeding the spike observed after Russia’s invasion of Ukraine,” putting global energy security at risk.

He said energy disruptions caused by the war would weigh heavily on Gulf exporters, while oil-importing countries such as Egypt and Jordan were facing higher commodity prices and weaker remittance flows.

More broadly, the Middle East and North Africa region is expected to see a marked slowdown in growth this year, with real GDP projected at about 1.1%, significantly below pre-war forecasts, before a recovery in 2027, according to the IMF.

Azour said the shock extended beyond oil and gas, noting that “commodity disruptions extend beyond oil and gas,” affecting fertilizers, chemicals, and other products in which the region holds a strategic position.

He warned that rising food costs were directly threatening vulnerable populations, saying that “these price increases translate directly into higher food costs for some of the world’s most vulnerable populations,” particularly in import-dependent economies across the region and beyond.

He added that the conflict had also affected services, saying, “air traffic collapsed at major Gulf hubs, maritime insurance premiums surged, shipping routes lengthened, and logistics chains weakened,” highlighting the broad impact on aviation and logistics.

The IMF said some oil-importing economies in the region relied heavily on Gulf countries for energy imports and financial flows, leaving them exposed if the conflict intensified or persisted.

Saudi experience

Azour said one of the most important lessons from the war and the disruption of the Strait of Hormuz was the need to diversify trade routes.

“This shock underscores the importance of building greater resilience and strengthening integration,” he said, adding that this includes “diversifying trade routes and deepening regional cooperation,” to ensure the continued flow of goods and energy.

He said Saudi Arabia’s approach under its strategic vision went beyond infrastructure development to a broader reshaping of logistics networks. By expanding alternative ports on the Red Sea and strengthening land and rail connectivity, the kingdom reduced its reliance on a single maritime chokepoint.

He said this ability to create parallel trade routes allowed Saudi trade to continue effectively despite disruptions to regional corridors, offering a model for protecting economic security and ensuring uninterrupted supply flows.

Egypt

Azour said economic reforms implemented by Egypt, along with stronger policy buffers, were helping the country better manage external shocks.

He said allowing the exchange rate to become more flexible helped absorb shocks, while higher reserves provided reassurance to markets.

Regional divergence

The IMF report highlighted a sharp divergence across countries. Qatar faced a steep downgrade to growth forecasts due to damage to its gas infrastructure, while Oman showed relative resilience given its geographic position outside the Strait of Hormuz.

At the same time, financing pressures increased on Egypt, Pakistan, and Jordan as sovereign spreads widened, prompting Azour to stress that the IMF stood ready to support countries.

He said that if oil production recovered and the Strait of Hormuz fully reopened, countries would be able to increase output quickly, adding that higher oil prices compared with pre-2026 levels would help producers recover some of their losses from the crisis.


Pakistan Central Bank Receives $2 billion from Saudi Arabia as Part of Broader Financial Support Package

Mohammed Al-Jadaan and Muhammad Aurangzeb following the agreement for Saudi Arabia to provide an additional $3 billion in support to Pakistan (X).
Mohammed Al-Jadaan and Muhammad Aurangzeb following the agreement for Saudi Arabia to provide an additional $3 billion in support to Pakistan (X).
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Pakistan Central Bank Receives $2 billion from Saudi Arabia as Part of Broader Financial Support Package

Mohammed Al-Jadaan and Muhammad Aurangzeb following the agreement for Saudi Arabia to provide an additional $3 billion in support to Pakistan (X).
Mohammed Al-Jadaan and Muhammad Aurangzeb following the agreement for Saudi Arabia to provide an additional $3 billion in support to Pakistan (X).

Pakistan announced that it has received $2 billion from Saudi Arabia’s Ministry of Finance as part of a broader financial support package.

Earlier, Pakistan’s Finance Minister, Muhammad Aurangzeb, said that Saudi Arabia had committed to depositing an additional $3 billion, while extending an existing $5 billion loan for three years instead of renewing it annually.

This support comes as Pakistan faces repayment of $3.5 billion to the United Arab Emirates, putting pressure on its reserves, which stand at about $16.4 billion.

Saudi Arabia has a history of assisting Pakistan during economic crises, including a $6 billion support package in 2018 that included deposits and deferred oil payments.


Gold Rises as Middle East Optimism Calms Inflation Fears

Samples of gold displayed in a program affiliated with the Brazilian Federal Police specializing in tracking gold in Brasilia (Reuters)
Samples of gold displayed in a program affiliated with the Brazilian Federal Police specializing in tracking gold in Brasilia (Reuters)
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Gold Rises as Middle East Optimism Calms Inflation Fears

Samples of gold displayed in a program affiliated with the Brazilian Federal Police specializing in tracking gold in Brasilia (Reuters)
Samples of gold displayed in a program affiliated with the Brazilian Federal Police specializing in tracking gold in Brasilia (Reuters)

Gold prices rose on Thursday as growing optimism about a possible end to conflicts in the Middle East calmed inflation worries and improved prospects for lower interest rates.

Spot gold rose 0.5% to $4,815.15 per ounce by 0926 GMT, after rising to a one-month high in the previous session. US gold futures for June delivery gained 0.3% to $4,836.50.

"For the month of March gold was under pressure because of the need for liquidity in the metal following the war, but that is kind of mostly run its course, that need for liquidity," said Nitesh Shah, commodity strategist at WisdomTree.

Shah added that he expects gold prices to remain very well supported as concerns surrounding central bank independence and dollar debasement risk still remain prevalent, Reuters reported.

Optimism grew on Thursday that the war in the Middle East may be near an end, with a key Pakistani mediator in Tehran and the administration of US President Donald Trump talking up hopes for a deal that would open the crucial Strait of Hormuz.

Crude oil prices were up more than 1% on Thursday, but remained well below the $100-a-barrel mark.

"Gold remains supported amid renewed optimism around de-escalation. The pullback in oil prices is easing some of the inflation concerns that weighed on prices earlier in the conflict. The move reflects a broader shift in market focus," ING analysts said.

Global equities vaulted past their previous all-time highs in Asian trading as optimism grew about a deal to end the Iran war.

Gold prices fell to as low as $4,097.99 an ounce on March 23 as high inflation concerns due to soaring energy prices raised expectations of a more hawkish approach to intrest rates by the US Federal Reserve, weighing on the non-yielding metal's demand.

Prices have since recovered as investors now see a more than 34% chance of at least one US interest rate cut by 2026-end, up from 32% a day prior, as per CME's FedWatch Tool.

Among other metals, spot silver rose 1.4% to $80.12 per ounce, platinum gained 1% to $2,130.25, and palladium was up 0.9% at $1,587.25.