Conflict in Gaza and a "tsunami" of change in the labour market driven by AI pose the biggest threats to economic growth in the region, the International Monetary Fund warned on Sunday.
The IMF’s managing director Kristalina Georgieva addressed the Arab Fiscal Forum in Dubai to suggest a road map out of economic uncertainty in the region.
The forum was part of the curtain-raising pre-summit sessions held ahead of the three-day World Governments Summit, which officially begins on Monday at Madinat Jumeirah.
Ms Georgieva said the global economy had proved remarkably resilient in the face of continuing wars in Gaza and Ukraine, and disruption to trade routes.
Despite that, a decade of slow growth lies ahead as nations look to diversify economies and capitalise on new technological trends.
“While uncertainties are still high, fuelled by the tragic developments in the Gaza-Israel conflict, we are more confident about the global economic outlook,” she said.
“The global economy has been surprisingly resilient and with inflation going steadily down, we are heading for a soft landing in 2024.
“We project growth for this year to be 3.1 per cent, but we cannot declare victory prematurely.
“Medium growth prospects remain anaemic at around 3 per cent year after year in comparison with the historical average of 3.8 per cent in the decades before the pandemic.
“Prospects for boosting growth are still overshadowed by high interest rates and very importantly by the need to restore fiscal sustainability.
“Turning to the immediate prospects for the Middle East and North Africa, we expect GDP growth to reach 2.9 per cent this year.
“This is higher than last year, but below our October projections.”
Global impact as war rages
Economically, the impact of the conflict has been devastating in Gaza where activity dropped 80 per cent from October to December compared to a year earlier.
Meanwhile, in the occupied West Bank, activity dropped by 22 per cent.
The Palestinian economy's dire outlook is worsening as the conflict persists with only durable peace and political solution likely to change economic prospects.
The conflict is negatively affecting tourism, a lifeline for many across the region, with the fiscal impact seen in multiple areas, such as increased spending for social safety nets, defence and security.
Across the region and beyond, the wider impact of the conflict is being felt through rising freight costs and reduced Red Sea transit, which is down by more than 40 per cent – almost half of what they were a year ago.
The disruption compounds the challenges of economies still recovering from previous shocks such as global pandemics and natural disasters.
The longer the fighting goes, the higher the risks of conflict widening, aggravating the economic risks, Ms Georgieva said.
In January, the World Bank said the global economy was facing its slowest half-decade growth in 30 years, driven by Middle East conflict.
Between 2010 and 2020, the world averaged an average economic expansion of 3.1 per cent.
Despite the slow growth, the IMF said global economies should prepare for transformative change in labour markets by bolstering digital infrastructure.
“If we are to make full use of technological advancements, like the development in artificial intelligence, we must be ready for them,” said Ms Georgieva.
“We have done some analysis in the IMF that shows roughly 40 per cent of jobs over the next few years will be exposed to artificial intelligence. This is like a tsunami eating into labour markets.
“Some jobs will disappear altogether, some jobs will no longer exist, other jobs will be enhanced or diminished. And we know that we can only take advantage of opportunities if we are ready for them.
“What our analysis shows is that the level of preparedness for the arrival of artificial intelligence is very different across the world.
“Accessibility for everyone is very important in terms of labour market development and skills development for the new world of artificial intelligence," said Ms Georgieva.
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Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
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The Matrix Resurrections
Director: Lana Wachowski
Stars: Keanu Reeves, Carrie-Anne Moss, Jessica Henwick
Rating:****
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
Wicked: For Good
Director: Jon M Chu
Starring: Ariana Grande, Cynthia Erivo, Jonathan Bailey, Jeff Goldblum, Michelle Yeoh, Ethan Slater
Rating: 4/5
KILLING OF QASSEM SULEIMANI
THE SPECS
Engine: 2.0-litre 4-cylinder turbo
Power: 275hp at 6,600rpm
Torque: 353Nm from 1,450-4,700rpm
Transmission: 8-speed dual-clutch auto
Top speed: 250kph
Fuel consumption: 6.8L/100km
On sale: Now
Price: Dh146,999
SANCTIONED
- Kirill Shamalov, Russia's youngest billionaire and previously married to Putin's daughter Katarina
- Petr Fradkov, head of recently sanctioned Promsvyazbank and son of former head of Russian Foreign Intelligence, the FSB.
- Denis Bortnikov, Deputy President of Russia's largest bank VTB. He is the son of Alexander Bortnikov, head of the FSB which was responsible for the poisoning of political activist Alexey Navalny in August 2020 with banned chemical agent novichok.
- Yury Slyusar, director of United Aircraft Corporation, a major aircraft manufacturer for the Russian military.
- Elena Aleksandrovna Georgieva, chair of the board of Novikombank, a state-owned defence conglomerate.
Haircare resolutions 2021
From Beirut and Amman to London and now Dubai, hairstylist George Massoud has seen the same mistakes made by customers all over the world. In the chair or at-home hair care, here are the resolutions he wishes his customers would make for the year ahead.
1. 'I will seek consultation from professionals'
You may know what you want, but are you sure it’s going to suit you? Haircare professionals can tell you what will work best with your skin tone, hair texture and lifestyle.
2. 'I will tell my hairdresser when I’m not happy'
Massoud says it’s better to offer constructive criticism to work on in the future. Your hairdresser will learn, and you may discover how to communicate exactly what you want more effectively the next time.
3. ‘I will treat my hair better out of the chair’
Damage control is a big part of most hairstylists’ work right now, but it can be avoided. Steer clear of over-colouring at home, try and pursue one hair brand at a time and never, ever use a straightener on still drying hair, pleads Massoud.
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The White Lotus: Season three
Creator: Mike White
Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell
Rating: 4.5/5
Champions parade (UAE timings)
7pm Gates open
8pm Deansgate stage showing starts
9pm Parade starts at Manchester Cathedral
9.45pm Parade ends at Peter Street
10pm City players on stage
11pm event ends
The Florida Project
Director: Sean Baker
Starring: Bria Vinaite, Brooklynn Prince, Willem Dafoe
Four stars
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Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
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Skoda Superb Specs
Engine: 2-litre TSI petrol
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Padmaavat
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3.5/5
MATCH INFO
Uefa Champions League semi-final, second leg result:
Ajax 2-3 Tottenham
Tottenham advance on away goals rule after tie ends 3-3 on aggregate
Final: June 1, Madrid
UAE currency: the story behind the money in your pockets
The National Archives, Abu Dhabi
Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.
Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en
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UAE currency: the story behind the money in your pockets
