Governments across the globe have committed to providing $9.6 trillion in response to the COVID-19 crisis and its related implications, which constitutes 11 percent of the global GDP, the head of the Economic and Social Commission for Western Asia (ESCWA) Rola Dashti said.
Dashti made her comments during a virtual panel on Sunday that was organised by the Kemet Boutros Ghali Foundation to address the global economy in the post COVID-19 phase.
Dashti said that the Arab region’s share of this figure was $100 billion, representing only 4 percent of Arab countries’ GDP, adding that the region needs an extra $100 billion to be able to counter and contain the impact of the COVID-19 crisis.
She also added that medium and low-income countries have appropriated the equivalent of 6.3 percent of their GDP to counter the repercussions of COVID-19, and this reflects how heavily indebted Arab countries are.
“Arab governments have to widen their financial space and adopt smart spending. Also, they are in need of establishing a social spending monitor for more transparency and to control financial waste,” said Dashti.
She added that 10 percent of the people in Arab countries own 76 percent of the region’s wealth, while 50 percent of the poor own only 2 percent of wealth.
Establishing the social spending fund reinforces the concept of social solidarity between rich and poor countries, Dashti said.
She also pointed out that 11 percent of the financial stimulus packages that were launched in Arab countries to contain the impacts of COVID-19 were allocated for humanity, 40 percent for SMEs, while the remaining 49 percent were not directed to a specific purpose.
Dashti urged Arab countries to adopt the concept of shared responsibility through entrepreneurship and start-ups that can benefit from large corporations and engage SMEs in their value chains, in addition to exempting them from paying a number of financial obligations for the sake of applying sustainable development in its broadest sense.
On the other hand, the UN Special Envoy for Sustainable Development Goals (SDGs) Agenda 2030, Mahmoud Mohiuddin, stressed that the achievement of the SDGs needs investment in three key sectors: people, infrastructure and resilience, adding that COVID-19 has forced the world to experience the “economy of fear,” as uncertainty will exist even in the post-COVID phase.
Egyptian Minister of Planning and Economic Development Hala Al-Saeed said that Egypt’s economic growth is expected to record -1 percent in the fourth quarter of the current 2019/2020 fiscal year, reaching a total of 3.8 percent by the end of 2020, down from previous estimations of 6 percent due to the pandemic.
Al-Saeed added that Egypt is prioritising investments, especially in digital transformation, expounding that the total investments in the sector since 2018 have reached EGP 50 billion and will be increased by 300 percent in the 2020/2021 fiscal year budget.
The new fiscal year begins on 1 July.