Growth-enabling policies a must for progress of Mena youth, IMF says

Younger People, Particularly Women, Key for Prosperous 21st Century in Middle East and Africa

Younger people, particularly women, are catalysts of growth in the Middle East and Africa, and enabling them to flourish will be key for a prosperous 21st century, International Monetary Fund managing director Kristalina Georgieva said.

The Last Growth Frontier: Africa and Middle East

The broader Africa and Middle East is the world’s last growth frontier, and it is time to bridge the gender gap and harness the region’s abundance of talent, she told a panel discussion on Tuesday.

Creating an Environment for Young People to Flourish

“It is very clear that the responsibility of policymakers is to create an environment for young people to flourish,” Ms Georgieva told delegates at the IMF and World Bank 2023 annual meetings in Marrakesh.

Barriers Inhibiting Progress

• Complicated procedures and restrictive regulations
• Lack of access to finance

These barriers are inhibiting the progress of young entrepreneurs, especially women. Young entrepreneurs are often denied funding due to their lack of credit history, indicating a stagnant situation. Ms Georgieva emphasized the need to unleash tremendous human potential for a prosperous world in the 21st century.

Africa: Powerhouse of Talent

Population trends over the next five decades indicate that Africa would be the powerhouse of talent, according to Ms Georgieva. She highlighted that China, Europe, and North America are experiencing population decline and aging, while Africa is the only place where young people are eager to work and contribute.

Mindful Policymaking and Opening Eyes

Policymakers need to be mindful of their actions and correct any mistakes that hinder growth. Ms Georgieva urged those who doubt the potential of Africa and the Arab world to open their eyes. She emphasized that expansion should be directed towards Africa, and the IMF will provide more financing to the Arab world and the African continent.

Importance of Removing Barriers for Inclusive Growth

The IMF will promote the removal of barriers that inhibit growth as it is not only important for young people, but for everyone. The organization has consistently raised concerns about complex rules, restrictive policies, and lack of financing for young entrepreneurs in Africa and the Middle East region. It advises member countries to bridge the gender gap and accelerate policy and structural reforms to bolster growth and enhance economic resilience.

Empowering Women for Economic Growth

The IMF in September stated that narrowing the gap between the number of working men and women can boost emerging and developing economies’ gross domestic product by about 8% over the next few years.

Female Labor Force Participation

Raising the rate of female labor force participation by 5.9 percentage points in these countries will help drive inclusive growth amid the world’s weakest medium-term economic growth outlook in more than three decades. Currently, only 47% of women are active in labor markets compared to 72% of men.

The Importance of Women’s Talent

Ms Georgieva strongly believes in bringing women forward because no country can be truly rich if it only relies on the talent of half its population. She highlighted Saudi Arabia as an example of eliminating legal obstacles to women’s participation in the labor market, where female participation has climbed to about 34%, higher than some advanced economies.

The Economic Impact of Women’s Participation in Saudi Arabia

The increasing participation of women in the Saudi workforce is expected to boost the country’s economy by $39 billion, or 3.5%, by 2032, if the current rate of growth continues, according to S&P Global Ratings.