By Daniel Shane
UAE’s status as trade hub cemented by two-and-a-half years of unrest
The impact of the Arab Spring political unrest over the last two-and-a-half years is expected to cost the seven most affected countries $800bn by the end of 2013, according to a report by HSBC.
The bank’s research said that the unrest, which dislodged long-standing leaders in countries including Egypt and Libya, will have lowered combined economic output from $2.9 trillion to $2 trillion over a four-year period. The other countries included in the HSBC report include Bahrain, which has been fighting an uprising since the start of 2011; Syria, in the midst of a bloody civil war; Jordan and Lebanon.
HSBC said that Gulf states including the UAE, Qatar and Saudi Arabia had been the benefactors of the unrest, with the latter cementing its status as a regional trade and finance hub. The report said that the UAE’s economy could grow by as much as 4.3 percent and 4.6 percent in 2013 and 2014, respectively, up from earlier forecasts of 4 percent and 4.1 percent. These increases could push consumer prices up by 4.5 percent in 2014, however, HSBC said.
Egypt’s economy is expected to expand by 3 percent in the fiscal year ending June 2014, HSBC said, up from an earlier forecast of 2.5 percent on the back of $12bn in pledged aid from Gulf states.
HSBC said the Libyan economy will grow 0.7 percent, down from an earlier prediction of 15.9 percent due to a sharp fall in crude exports amid strikes.
Morocco’s economy will grow 2.8 percent, down from an earlier thought 3.4 percent, while Bahrain’s economy could increase 3.6 percent this year, HSBC said.