Rebecca Harding, CEO of Coriolis Technologies, discusses Mena’s trade performance, its projected growth and key political risks for 2019.
GTR: The level of oil dependency in Mena has to a large extent made it the hostage of oil prices. Is there any sign that the region is becoming less dependent on oil?
Harding: Oil dependency is a big challenge for the Mena region. The economic performance of the region’s oil producers is potentially affected by any change in price. Although there are signs that regulators across many countries have tightened fiscal regimes in order to provide buffers against fluctuations in commodity prices, particularly oil, the fact remains that the region is vulnerable. Lessons on macroeconomic management may well have been learned from the past few years’ commodity price slump, but the role of oil in the region is unlikely to diminish anytime soon.
Hydrocarbons dominate the region’s export profile (Figure 1). Oil and gas accounted for an estimated 50% of all export values across Mena in 2018. Commodities not elsewhere specified (NES), which is highly correlated with oil trade, accounted for a further 25% of all exports.
The relationship between the price of oil and the value of the region’s exports is critical for determining the amount of export revenue that it generates. For example, an annualised index of export volumes from the region suggests a modest climb of just over 20% since 2010 (Figure 2). Over this period, the correlation between the oil price and export volumes is -0.7. In other words, there is a strong negative relationship between oil prices and trade: if oil prices go up, then export volumes decrease and vice versa.
As further evidence of the region’s oil dependency, there is a strong positive correlation between the value of Mena’s exports and oil prices, at 0.93%. In other words, if the price of oil goes up, then the value of exports goes up, and vice versa. These two facts together highlight a challenge for the region: when the price of oil is low, revenues fall, but when the price of oil is high, volumes fall. Either way, it has a dampening effect on GDP as well as trade volumes.
Generally speaking, it is a mantra that trade will grow at twice the level of GDP. Between 2016 and 2017 this was certainly the case for the G7 and other advanced economies (Figure 3). The CIS countries’ trade grew even faster than that, but this can be explained by a lower trade volume in the first place and the rapid increase of oil trade from Russia to China.
The oil exporting regions, on the other hand, have not followed the same growth pattern since the financial crisis, particularly recently as oil prices have recovered. Mena is the most marked case in point: the region’s GDP has grown, but its trade volumes have fallen back. This is again explained by the strong negative correlation between oil prices and trade volumes: as oil prices started to recover towards the end of 2017, trade volumes fell. Interestingly, trade growth in Sub-Saharan Africa, which has a similar dependency on oil prices and commodity prices more broadly, has matched GDP. This may be because the region has succeeded in carrying out the necessary economic reforms to stabilise some of the larger economies.
Mena’s diversification, then, will not come from its exports in the short or even medium term. The sector is simply too dominant. This does not suggest, however, that the economic base of the region isn’t changing, and there are two things that paint a more complete picture of the direction it is moving.
Firstly, imports to Mena are not dominated by oil. The region’s top 10 ports handled some 472 million tonnes of cargo in 2017, with the UAE and Saudi Arabia accounting for 170 million and 185 million tonnes respectively. This means that Mena’s role as a route to other parts of the world cannot be understated, and it ties the region’s economic fortunes to trade rather than to oil prices alone.
This is reflected in the region’s import profile (Figure 4), which shows a much more diverse picture. Although commodities NES and ‘other’ may well include oil trade, the chart generally reflects a wide sectoral diversity of imports.
Secondly, and of even greater importance, is the extent to which imports are driven by domestic demand. Interestingly, the region imports nearly US$50bn more in electrical machinery and components, US$77bn more in machinery and components and US$51.7bn more in automotives than it exports. In other words, the imported goods are destined for the region and not being sent on elsewhere, indicating that local demand is strong.
This is corroborated by the role that the service sector plays in the region. Service sector exports grew at an annualised rate of 4.7% between 2013 and 2018, driven to a large extent by travel services exports growth at an annualised rate of 5.9% and transport services growth at 3.5%. These are the largest sectors and the two that are growing quickest.
In summary, there is little evidence that the region is becoming less dependent on oil in terms of its exports or trade revenues. This is affecting GDP, which was flat in 2017, even if some growth is expected for 2018. The region’s governments are trying to create more solid foundations to address the problem. For example, government debt as a proportion of GDP has fallen overall. This means that there is less risk should oil prices not recover to above breakeven levels, which the IMF has estimated at between US$63 and US$125 per barrel, depending on the country, for 20182. Maintaining the focus on economic reforms, particularly in Saudi Arabia, will be key over the longer term.
GTR: Which countries in particular are seeing an improvement in their trade performance?
Harding: The average monthly growth figures between November 2016 and November 2018 (the latest month for which full data was available at the time of writing), suggest that Iraq, Algeria, Bahrain and the UAE have improved most in terms of the values of exports (Figure 5). These countries have varying dependency on oil. For example, 20% of the UAE’s exports are oil, 55% of Bahrain’s (although only accounting for 11% of GDP), but for Algeria and Iraq, this proportion is 94% and 99% respectively. In other words, in the UAE’s case it is likely that trade grew in 2017 because of reasons other than the recent increase in oil price. For the other countries, meanwhile, oil played a major part.
For example, Algeria’s export trade with the world grew by 17% between 2016 and 2017. Albeit from a smaller base, its trade with China grew by 90% over the same period, with India by 81%, and with South Korea by over 200%, suggesting that a new trade route has opened up. Algeria’s growth in exports to emerging and developing Asia was 60%. Exports to its three largest trade partners – France, Spain and Italy – grew by 14%, 12% and 22% respectively. Exports to the US, Algeria’s fourth-largest trade partner, fell by nearly 3% over the same period, while exports to Brazil, its fifth-largest partner, grew by 18%. However, over a longer period of time, from 2012 to 2017, annualised growth in Algeria’s exports to all of these top five countries has narrowed, except for fuel exports, earnings from which rose by 28% annually.
What this tells us is that Algeria is increasingly looking to Asia and Eurasia for growth, independently of the price of oil. This is substantiated by the fact that, over the five years to 2017, annualised growth of exports to CIS countries was 40%, to Singapore 21%, and to Australia 22%. Algeria’s trade with Kuwait, Jordan and the UAE also grew, which could suggest increasing intra-regional trade within Mena.
The UAE’s trade growth has been similarly strong. The country relies to a far greater extent on its intermediary role as a port, but even so, commodities NES and mineral fuels are its top two trade sectors. Trade in mineral fuels has declined by more than 6% since 2012, a trend that is expected to continue over the next couple of years at a rate of 1% a year, as infrastructure-related products grow in importance. Coriolis Technologies expects trade in building products such as plaster, earth and stone to grow annually by nearly 8% over the next three years, aluminium and aluminium products by 10.7% and plastics by 11.6%. Much of this is driven by Expo 2020 construction work. Already, non-fuel export earnings have grown at 11.8% between 2016 and 2017 – twice the rate of fuel-related export earnings growth (5.1%).
As with Algeria, Asia, and particularly emerging Asia, is a fast-growing export partner for the UAE. UAE trade with China grew by 2.4% annually between 2012 and 2017 and by 23% between 2016 and 2017 alone. The UAE’s trade with India, meanwhile, grew by 20% between 2016 and 2017, a recovery from the 2012-2017 period where trade in this corridor fell back at an annualised rate of over 9%. This suggests that UAE trade with India, unlike trade with China, has a stronger oil component to it. UAE exports to Japan fell by over 13% between 2012 and 2016, but increased between 2016 and 2017 by nearly 20%. India, Japan and China were the UAE’s first, second and third-largest export partners by Freight on Board values in 2017.
In contrast, the picture for Iran deteriorated significantly between 2016 and 2018. This is partly a function of geopolitical tensions within the region, as well as with the US.
In the 12 months to November 2017, Iran’s exports to the US fell by 26% and to Australia and the UK by 47%. However, some countries have continued to trade with Iran: exports to China, for example, rose by 24% in the same period. This number was 33% for India and 30% for CIS countries, including Russia.
Iranian trade with Europe has seen an even more significant rise. Over the period 2012-2017, Iran’s trade with European Union countries grew on average 9.8% annually, despite an overall fall in value of exports to the world by 4.7%. And in the 12 months to November 2017, Iran-EU trade grew by no less than 96%. Most significantly, Iranian exports to the Netherlands increased by over 40% and to Germany 34%. As a result, Iran still experienced an overall export growth of 3.4% in the 12 months to November 2017. It serves to highlight why Europe has focused its strategic attention on ensuring that trade with Iran can continue despite the US’ re-imposition of sanctions on Iran.
While China, India and CIS countries are far bigger trade partners for Iran than Germany or the Netherlands, the latter are the fastest-growing export destinations for the Middle Eastern country.
This deterioration in the geopolitical climate for Iran continued between 2017 and 2018, which is reflected in a 5.1% fall in Iran’s exports in the 12 months to November 2018. Exports to Europe appear to have been particularly severely affected with a drop of greater than 20%.
Syria’s decline in exports is unsurprising: the country has suffered greatly from its civil war and although oil export revenues were boosted in the 2016-17 period, tighter sanctions in 2017-18 have affected its embryonic growth.
Finally, Morocco has also seen a slowdown in trade growth, a trend that can be interpreted as caused by more than simply oil prices. Oil represents just under 1% of its exports and in the past the country’s growth has been driven by sectors like machinery and components, automotives and electrical equipment, which constitute its major exports. These are intermediate manufactured goods and part of supply chains elsewhere, suggesting that Morocco has been more affected by the performance of the global economy and supply chains rather than the oil price slump as elsewhere in the region.
In summary, the trade performance of Mena as a whole is mixed. This is a function of both its geopolitical status and its dependency on oil. Both will continue to be fundamental drivers of trade performance in the near term and the region’s trade well-being is therefore dependent on policymakers’ ability to minimise any volatility that stems from this.
GTR: Saudi Arabia has historically dominated trade in the region, but was seeing particularly sharp reductions in its trade last year. What do the figures tell us about how this is panning out?
Harding: Saudi Arabia no longer dominates trade in the region in the way that it has done historically. The last few years have caused its trade to fall back slightly because of the drop in oil prices and more general economic turmoil in the country. In fact, in terms of trade, the UAE has taken over as the region’s largest exporter by value. Because nearly 80% of Saudi Arabia’s trade is driven by oil, it has been particularly vulnerable to commodity prices. The breakeven oil price for the country is US$75 a barrel, according to the IMF, so with an average oil price of US$43.58 in 2016, US$50.84 in 2017 and US$64.9 in 2018, even a slight increase in price in the last 12 months has not helped the country’s overall financial stability.
However, economic reforms are underway to address the burgeoning debt that is now at around 8.5% of GDP. This includes reforms to the labour market which are much-needed to deal with Saudi Arabia’s near 40% youth unemployment and 12.9% overall unemployment. Under reforms introduced in 2018, one particular measure has been to require that 70% of newly-created jobs must be taken by Saudi nationals. Some argue that addressing labour market issues is the most important aspect of modernising the economy.
The decline of Saudi Arabia’s dominance in the region is visible in its share of exports. When oil prices were high, all other countries were dwarfed in comparison. This started to change in 2017 and it is now the UAE that dominates Mena trade, accounting for 27% of the region’s export values (Figure 6).
Looking at figures for foreign direct investment (FDI), Saudi Arabia’s annual growth of 3.1% between 2008 and 2017 (the latest date for which complete data was available) appears modest and has potentially been a contributor towards weaker economic performance and trade growth over the past few years (Figure 7).
This is compared to the UAE, which saw FDI grow at 10% annually. Interestingly, Israel, Iran and Egypt rank among the top countries for inward FDI, with Iran in particular growing strongly in terms of inward investments between 2016 and 2017.
A weaker inward FDI into Saudi Arabia could be caused by many things, not least the geopolitical climate and declining economic performance. There is little evidence, however, that the modest FDI growth is caused by the underlying business climate. The World Bank’s Ease of Doing Business indicators suggest that Saudi Arabia is an easier place to do business than the UAE, Morocco, Oman and Qatar (Figure 8).
Yet the challenge for policy in Saudi Arabia – as for the UAE – is to build an entrepreneurial culture. Measuring a range of conditions necessary for entrepreneurial growth, the Global Entrepreneurship Monitor found in 2018 that while both Saudi Arabia and the UAE score reasonably well in terms of their physical and services infrastructure, they fare less well across other indicators such as education and training, financing for entrepreneurs, and taxes and bureaucracy (Figure 10). As a result, the average score for the two countries’ entrepreneurial framework conditions is 2.3 out of 5 for Saudi Arabia and 3 out of 5 for the UAE. If the economies are to reduce their dependency on oil, then entrepreneurship and supporting small business growth needs to take centre stage.
To summarise, Saudi Arabia rode the crest of the oil price wave up until the collapse in prices between 2013 and 2014. After that, inward investment to the country has flattened and the government’s reform measures have so far had a modest impact on the overall conditions for businesses. There is an intention within the kingdom to speed this up, and the economic reforms implemented by Prince Mohammed bin Salman have been well received. The challenge will be to match these reforms with the country’s need to address international concerns on human rights and its military actions in Syria.
GTR: China’s Belt and Road Initiative (BRI) is dominating the trade debate around the world. What impact will this have on the Mena region?
Harding: China is Mena’s largest export partner and although trade values have fallen back significantly over the last five years, this is because of the fall in commodity prices. Oil accounts for the majority of Mena exports to China and Mena’s role in Chinese energy security has been growing substantially as countries like Saudi Arabia have reduced their dependency on the US and turned towards China and even Russia as destinations for their exports.
For Mena, it is likely that the BRI will be a double-edged sword. China has increased its investment in the region exponentially since 2005, with a particular focus on Saudi Arabia, the UAE, Egypt and Algeria (Figure 11).
The biggest oil exporters are clearly the winners here, but China’s strategic investment in the region is likely to be more politically significant. The BRI is the embodiment of China’s foreign policy stance: that conflict and disputes are less likely if every economy is growing and individuals have access to that wealth. It sees itself as exporting its own economic model to other countries that may benefit from investment, and while this has created a heavy debt burden in countries like Pakistan and Sri Lanka, the Chinese attitude to this is that the long-term prospect of growth outweighs the short-term problem of debt. As the BRI is not scheduled to be completed until 2049, this is a very long-term ambition.
Meanwhile, the political challenges that the BRI could bring to the Mena region cannot be understated. At present, the proposed route goes north of the Gulf through Kazakhstan, into Iran and across to Greece. Investments in Iran or Pakistan could deepen some of the tensions between Saudi Arabia and Iran. The sea route passes by the Horn of Africa, up the Red Sea and through the Suez Canal. These are highly sensitive areas, and the fact that China has proposed economic aid of US$15mn to the Palestinians and US$90mn to reconstruction and economic development in Syria, Yemen, Jordan and Lebanon could create tensions. These tensions will not just be felt in the region, but have the potential to spill into a global dispute between the US and China as the investments themselves could be interpreted as being politically motivated.
The biggest considerations for the UAE and Saudi Arabia will centre around their existing debt burden and their desire for increased inward investment. Saudi Arabia is in a weaker position in terms of acquiring greater long-term debt than the UAE, but both countries have invested heavily in developing trade with China over the last five years and will be reluctant to hamper that progress.
It is estimated that around US$210bn of the originally planned US$1tn of BRI investment has already been spent, predominantly across Asia. However, the hubris originally surrounding the BRI has abated since it first became explicit Chinese policy in 2013. Countries like Malaysia and Pakistan have paused to review their participation as their own fiscal challenges have the potential to become more acute with greater involvement. The ‘Chinese Marshall Plan’1 is focused on economic development, and yet in some countries, Chinese firms are seen to be benefitting over and above local ones.
Within the Mena region, unemployment is under-reported and is possibly much higher than public records state. Because the region also suffers from insurgencies and popular uprisings, investment from China linked to Chinese businesses may not provide the answers that policymakers are currently seeking. This is particularly the case for some of the most heavily invested countries, such as Egypt, Algeria and Saudi Arabia, where unemployment is currently 10.9%, 11.6% and 12.9% respectively. Similarly, with net debt of GDP at 28% in Algeria and 82% in Egypt, adding to the debt burden may be ill-advised at this stage.
However, it’s worth pointing out that there are benefits of significant Chinese investment in the Mena region, particularly because of the boost in global trade that BRI will undoubtedly bring. When the BRI policy was first announced, the project was seen in a positive light because of just that. It is important for the region’s businesses, financial institutions and policymakers to think objectively about the costs and benefits of the initiative as failure to do so may limit growth and economic co-operation in the future.
GTR: Last year it was too early to tell whether the Qatar blockade was having any impact on trade in the region. What is the update this year?
Harding: Qatari trade overall has been impacted by the blockade imposed by Saudi Arabia, Egypt, Bahrain and the UAE in June 2017. The country’s exports to the world fell by 2.8% in the 12 months to November 2017 and then by a further 1.3% on average monthly in the 12 months to November 2018. Clearly Qatar is not immune from the general impact of lower oil prices, but, as Figure 12 shows, the blockade has prompted a further reduction in Qatari exports to the four countries, and Russia. Instead, exports to China have been growing and while they fell back slightly at the beginning of 2018, this is more likely to be driven by oil prices than by the blockade.
When the blockade was first imposed, the goal was to shut Qatar off and to prevent it from trading. However, Qatar diverted its trade routes and, as can be seen in Figure 13, imports from other countries, such as China, Turkey and Iran, gathered pace after June 2017. Naturally, imports from all blockading nations, particularly the UAE, fell back.
Little has been gained from the blockade, either politically or economically. Its effect has been to increase Qatar’s trade with China and, should the blockade be lifted, it will be difficult for the UAE and the three other nations to regain the trade that they have lost. While it does put Qatar on a collision course with the US because Qatar is now trading overtly with Iran, this is a relatively small proportion of overall Qatari trade.
GTR: What sectors will play the most significant role for the region in the future?
Harding: Mena countries are modernising their economies and this presents real growth opportunities. As previously mentioned, it is unlikely that the role of oil and gas in the region will diminish in the immediate future. That said, there are several sectors that are going to grow rapidly. Tourism and travel are both growing, and the transport and infrastructure sectors through ports and airports will develop the region’s capacity as a high-tech transportation hub.
It is this focus on technology where real growth can be seen through orthodox trade measures. For example, the region’s two largest trading nations, the UAE and Saudi Arabia, are both increasing their infrastructures to support digital technologies. This is visible in the imports of goods associated with digital storage and digital processing, which are increasing in both countries (Figure 14 and 15).
Interestingly, the UAE is also increasing its exports of digital equipment (Figure 14) and while this may not be based on its own manufacturing capacity, it is almost certainly a function of its role as a hub for exports to other countries within the region.
The role of technology in trade will grow over time. Figure 16 gives a picture of this sector’s increasing importance in Mena. The hi-tech proportion of all manufacturing exports in the region grew between 2013 and 2016 (the latest year for which data is available). Israel has the highest proportion of technology in its export profile and Egypt the lowest.
Despite its growth in certain areas of technology, the UAE, along with Oman, saw the technology component of trade decrease. In the case of the UAE, this may be because the country has seen the value of its commodity trade increase, therefore reducing the technology proportion in relative but not absolute terms.
Technology and services are very likely to play a bigger role in the Mena region’s trade in the future. This is unlikely to diminish the overall role of oil but it may fuel more diverse trade. Digital trade in particular has a key role to play in easing the high non-tariff barriers to trade in the region: digital trade almost by definition crosses borders invisibly.
Similarly, trade finance is being re-configured with a greater role for blockchain and artificial intelligence. The success of these will rest in appropriate data transparency, in other words, the commitment to publish and share data. The growth in imported digital storage could suggest that this an increasing focus of institutions and policymakers.
GTR: What are the key political risks in the region in 2019, and have they changed from last year?
Harding: The Middle East is arguably one of the most economically significant, but strategically challenging regions in the world. Six of the world’s top 10 largest oil reserves are Middle Eastern countries, the region houses an estimated 920 billion barrels of oil and private wealth was recently estimated at a staggering US$5.2tn. There are also crucial trading routes, such as the Suez Canal, which accounts for roughly 10% of global trade, and Dubai’s port of Jebel Ali, which connects Rotterdam with Singapore.
In spite of the undoubted opportunity and potential, the region also experiences a high level of political instability and violent conflict. In 2017, the Middle East gained the dubious honour of being ‘the world’s deadliest region’, hosting seven of the 10 most violent global conflicts. Terrorism and the proliferation of weapons of mass destruction are perennial concerns and, over the last few years, the ongoing conflicts in Syria and Yemen have exposed the fierce competition for influence between Middle Eastern powers. Iran, Israel, Lebanon, Saudi Arabia, Turkey and the UAE have all pursued their national interests through varying degrees of involvement in these conflicts, often with the financial or military backing of global powers such as the US, Russia and China. As a result, security challenges in the region are a complex combination of national, regional and global factors.
Since the start of the conflict in 2011, the war in Syria has claimed an estimated 500,000 lives. The intensity of the fighting has declined in the first months of 2019 and the battle against IS seems to be drawing to a close. At the time of writing in April, the Islamist terrorist group has been pushed back by the US-led coalition to Baghouz, a small village in Eastern Syria. While its military defeat may be imminent, this does not mean that regional tensions will abate. The conflict in Syria involves multiple global and regional powers, meaning IS’ defeat may result in repercussions that reverberate beyond the country’s borders.
Crucially, Syrian President Bashar al-Assad enjoys the support of Russia as well as Iran. Syria has been a key Iranian ally since the 1979 Islamic revolution, and Iran’s Islamic Revolutionary Guard Corps has maintained a constant presence in Syria since the outbreak of the conflict. More specifically, Iran wants to preserve its strategic relationship with Lebanon-based militant group Hezbollah, to whom it provides an estimated US$700mn each year. Of course, Iran and Lebanon are not connected by a border and so Syria is used as the route for the transfer of financial, military and logistical support. Crucial to Iran’s interests is the Syrian city of Al-Zabadani, which is extremely close to the border with Lebanon.
Iran-backed Hezbollah fighters have been moving ever closer to Syria’s border with Israel. In response, Israel has bolstered defences in the Golan Heights, carried out airstrikes on Iranian and Hezbollah positions in Syria and stated that any incursions across the border are a ‘red line’. There are fears that Iran is taking steps to establish sleeper cells near the Israeli border and, in December 2018, the Israeli Defence Force stated that it had discovered a Hezbollah tunnel network. It is possible that as the dust settles from the conflict in Syria, more serious tensions between Israel and Iran and Lebanon will emerge. The opposing interests of the US and Russia, who back Israel and Iran respectively, mean the issue of Syria has serious global implications.
The conflict in Yemen also shows little sign of reaching a conclusion and is still one of the most desperate humanitarian crises in the world. An estimated 6,600 civilians have lost their lives in the fighting, 20 million Yemeni citizens are at risk of starvation, and 1.1 million have been affected by a Cholera outbreak.
As with Syria, competing regional interests are exacerbating the situation: Saudi Arabia overtly supports the Hadi government forces, and while Iran has never publicly declared its support for the Houthi rebels, it is implicitly understood that the country has been providing financial and military support. For example, according to the UN, ballistic missiles fired into Riyadh by Houthi rebels in Yemen in 2017 and 2018 appeared to be Iranian-made.
The conflict has also drawn in the UAE in a meaningful way. The UAE has had detention centres in Yemen since 2015, and in July 2018, Amnesty International reported that “scores” of detainees were released from the centres run by the UAE military. The military also joined the Saudi-led bombardment of the Houthi-held port of Hudaydah. This undermines the UAE’s neutral position in the GCC and, along with the continued blockade of Qatar, increases the fragility of relations between Gulf neighbours.
Iran’s hand in the conflict in Yemen means that Saudi Arabia is not likely to abandon its objective of crushing the Houthi rebels and restoring the Hadi government. It would be unacceptable to them to have Iranian-aligned interest groups on their southern border and this fact will likely prolong the conflict indefinitely.
In summary, the key challenge for the region as a whole is to overcome its reputation as the world’s ‘deadliest’ region if it is to develop its role as a global trading hub. Compliance concerns, particularly around know your customer and anti-money laundering, have dominated the trade finance conversation since 2012 and have, along with the dependency on oil prices, held back the region’s development.
Mena’s politics are complex and interdependent with its trade, as the blockade of Qatar suggests, but also as the complexities of the role of China’s BRI have shown. Inward investment from China alongside shifting alliances towards Russia by Egypt and even Saudi Arabia muddy the waters and add to the political tensions in the region.
To some extent, as shown by the picture for inward investment over the last few years, the instabilities in Mena are priced in. The region has always provided a proxy for the conflict between the US and Russia, because major players have aligned themselves with either side: the West in the case of Saudi Arabia and the East in the case of Iran. The increasing pull towards the East has been evident in the region’s trade data for a number of years, as reported previously. Much of this has focused on oil and, with China now entering the fray, albeit on a politically neutral basis, there is a danger that the tensions are exacerbated by the counter-balancing forces of isolationism in trade and foreign policy from the US. Under these circumstances, it is hard to see how the political risks in the Mena region will abate2.
1 The Marshall Plan was an American-led initiative to provide aid to war-torn Europe at the end of the second world war. The funding was a mix of grants and loans and distributed to European nations in relation to the size of their GDP. The Belt and Road Initiative has been likened to this in that it is a large sum of money through a mixture of investment and loans.
2 Content is based on Coriolis Technologies’ geopolitical risk rankings and analysis by Jack Harding