IMF: MENA current account surplus to hit $140 billion

IMF: MENA current account surplus to hit $140 billion

International Monetary Fund says region’s current account surplus will triple in 2010 as capital flow resumes and oil prices rise.

May 25, 2010 4:08 by Samuel Potter

The current account surplus of the Middle East and North Africa region is set to triple to $140 billion this year according to the International Monetary Fund, reports Gulf News.

The figure, spurred on by rising crude prices and increasing liquidity, dwarfs that of 2009, which was just $53 billion.

However, the IMF’s Regional Economic Outlook also pointed out that stresses in the banking and finance sectors are working against the rebound.

IMF Middle East and Central Asia Director Masood Ahmad told the paper, “The outlook for the region has improved considerably from 2009. Growth is gathering momentum in 2010, helped by the pickup in capital inflows and resurgence in domestic consumption.

However, this positive perspective is clouded by some stress in the banking system and lethargic credit activity across the region.”
“Governments will have to balance the goal of reactivating credit with the need to strengthen financial regulation and enhance supervision, particularly in countries where there is evidence that excessive risk-taking occurred,” he added.