The unrest that toppled two leaders in Egypt, removed Muammar Gaddafi from power in Libya and plunged Syria into civil war will lower cumulative economic output in the nations to just above $2 trillion from $2.9 trillion over the four years, Dubai-based economists with HSBC estimated in a report released on Tuesday. The other two countries included in the study are Jordan and Lebanon.
“Such a long period of sub-trend growth offers scope for a period of more rapid expansion as troubled economies bounce back,” Simon Williams and Liz Martins said in the report.
Egypt has received $12 billion in aid pledges from Gulf countries to support dwindling foreign reserves and shore up public finances since the military’s ouster of president Mohammed Mursi in July. The funds will help the economy expand three per cent in the fiscal year that ends in June 2014, HSBC said, revising an earlier forecast of a 2.5 per cent growth rate.
Egypt is struggling to recover from the chaos that accompanied the 2011 uprising that ended Hosni Mubarak’s three-decade autocratic rule. The revolt was followed by the overthrow of Libya’s long-time leader Gaddafi.
Libya’s oil-driven economy may expand 0.7 per cent this year, HSBC said, compared with a forecast of 15.9 per cent three months ago, after protests and strikes cut crude exports. The London-based bank also cut Morocco’s GDP growth forecast this year to 2.8 per cent from 3.4 per cent.