Middle East and Central Asia > Saudi Arabia
Abstract
Across the Middle East and Central Asia, the combined effects of global headwinds, domestic challenges, and geopolitical risks weigh on economic momentum, and the outlook is highly uncertain. Growth is set to slow this year in the Middle East and North Africa region, driven by lower oil production, tight policy settings in emerging market and middle-income economies, the conflict in Sudan, and other country-specific factors. In the Caucasus and Central Asia, although migration, trade, and financial inflows following Russia’s war in Ukraine continue to support economic activity, growth is set to moderate slightly this year. Looking ahead, economic activity in the Middle East and North Africa region is expected to improve in 2024 and 2025 as some factors weighing on growth this year gradually dissipate, including the temporary oil production cuts. But growth is expected to remain subdued over the forecast horizon amid persistent structural hurdles. In the Caucasus and Central Asia, economic growth is projected to slow next year and over the medium term as the boost to activity from real and financial inflows from Russia gradually fades and deep-seated structural challenges remain unsolved. Inflation is broadly easing, in line with globally declining price pressures, although country-specific factors—including buoyant wage growth in some Caucasus and Central Asia countries—and climate-related events continue to make their mark. Despite some improvement since April, the balance of risks to the outlook remains on the downside. In this context, expediting structural reforms is crucial to boost growth and strengthen resilience, while tight monetary and fiscal policies remain essential in several economies to durably bring down inflation and ensure public debt sustainability.
Abstract
In response to the Global Financial Crisis, the IMF launched many initiatives to strengthen financial surveillance and better advise member countries of vulnerabilities and risks. While these initiatives have not yet been tested by a major crisis, the efforts have delivered a substantial upgrade of the Fund’s financial surveillance, including giving the IMF clearer responsibilities over financial sector stability and cross-country spillovers; making periodic financial stability assessments mandatory for jurisdictions with systemically important financial sectors; invigorating efforts to integrate financial and macroeconomic analysis in bilateral and multilateral surveillance; enhancing cooperation with the Financial Stability Board and standard setting bodies to promote reforms and monitor agreed standards; and taking steps to recruit and train greater financial expertise. While recognizing these achievements, this evaluation finds that the quality and impact of the IMF’s financial surveillance has been uneven. The expansion of products and activities has presented the Fund with difficult trade-offs between bilateral and multilateral surveillance; between countries with systemically important financial sectors and other member countries; and between financial surveillance and other activities. Moreover, resource constraints have slowed the needed build-up of financial and macrofinancial expertise. These are critical issues, given the IMF’s position as the only international financial institution with the mandate and ability to conduct financial and macrofinancial surveillance over the full range of countries as well as the global economy, and given that these issues are at the core of the IMF’s responsibilities. Thus, to further strengthen financial surveillance, the evaluation recommends devoting greater resources to financial surveillance overall; further strengthening financial and macrofinancial analysis in Article IV surveillance; refining resource allocation for FSAPs; enhancing rigor and transparency in multilateral surveillance; intensifying efforts to be a global center of excellence on financial and macrofinancial research; and extending efforts to develop financial expertise among IMF staff.
Abstract
The Annual Report to the Board of Governors reviews the IMF’s activities and policies during any given year. There are five chapters: (1) Overview, (2) Developments in the Global Economy and Financial Markets, (3) Policies to Secure Sustained and Balanced Global Growth, (4) Reforming and Strengthening the IMF to Better Support Member Countries, and (5) Finances, Organization, and Accountability. The full financial statements for the year are published separately and are also available, along with appendixes and other supplementary materials.