Economic Policy Implications of COVID-19 in MENA Countries
Paper Session
Sunday, Jan. 9, 2022 10:00 AM - 12:00 PM (EST)
- Chair: Mahdi Majbouri, Babson College
First Out, Last in Amidst COVID-19: Employment Vulnerability of Youth in Egypt, Jordan, Morocco, Sudan and Tunisia
Abstract
In light of the pre-existing structural obstacles in accessing decent jobs, a COVID-19 caused break from service will undoubtedly impair youths’ and women’s future employment prospects. We thus propose to analyze the impact of the pandemic on vulnerable workers in Egypt, Jordan, Morocco, Tunisia and Sudan statically as well as dynamically, using microdata from the ERF COVID-19 MENA Monitor supplemented by national data on the severity of the COVID-19 crisis and policy responses. We use tabulations and graphical methods to examine the interactions of workers’ employment vulnerability with their socio-economic status. We use transition matrices and multinomial logistic regressions to study dynamically workers’ employment trends across different phases of the countries’ COVID-19 crisis, analyzing the differentiated outcomes for youth and non-youth and men and women. We further examine whether transitions from formal to vulnerable work statuses was also an important phenomenon in this crisis. The results of our analysis will inform about the impacts of the COVID-19 crisis and government responses to it on the employment outcomes of various groups of workers, particularly focusing on the scale of vulnerable employment among youth and female workers. We draw implications regarding the factors behind workers’ vulnerable employment status, and provide policy recommendations regarding the vital forms of support systems that can help mitigate the impact of the shock on these workers.Effects of the COVID-19 Crisis on Manufacturing: Evidence from Egypt
Abstract
This paper descriptively assesses the effect of the crisis on some main indicators of firm level economic activity in Egypt. The paper will also identify important transmission mechanisms. These effects will differ from sector to sector and by other factors such as firm and man-agement characteristics, ranging from size to nationality of ownership, to location (industrial zone or other), technology adopted in the firm before the crisis hit; and how far its production processes depend on automation, or the ability of its workers to perform substantial tasks from home. The effects will also differ based on the support received from government. On account of the expected change in demand, some sectors may relatively benefit, likely those in chemicals and pharmaceuti-cals but many others will lose. Information on shutting down, full or partial exit will also be pre-sented as part of the assessment of the damage.This analysis will also specify effects of the crisis on Value Chain operations, Sales, Exports, Employ-ment and Productivity by Firm Size, Sector, Spatial Agglomeration and informality status. The survey covers about 3000 firms of which 2000 are still in operation. Two questionnaires were administered one for firms that are still in operation, and another, very similar one, for firms that have exited the market or have temporarily shut down operations during fieldwork time. The data were collected at the beginning of the second wave extending to the height of it, precisely between November 19th 2020 and 31st of January 2021. The data are representative of the entire manufacturing sector in Egypt, that is firms belong to the formal as well as the informal sector, export or predominantly serve the domestic market, are locat-ed both in and out of special economic areas and zones, are both private and public and are of all firm sizes.
Changing Nature of Work Due to COVID-19: Determinants of Teleworkability in Turkey
Abstract
In March 2020, Turkey observed first case of COVID-19 and since then every individual regardless of their demographic background or wealth unfortunately suffered from its fatal effects. Following the social distancing policies adopted by the government, most of the firms started to change their organizational structures based on remote work while some forced to shut down. That has reflections enlarging disparities in working composition between different groups of workers like high- and low-paid, white- and blue-collar, formal- and informal employment and gender. With using household labor force survey data provided by TURKSTAT, this study aims to measure remote working capacity of Turkey at sectoral level by following Dingel & Neiman (2020) occupation classification methodology and capture its determinants with regional perspective. Occupation classification methodology allows to identify whether the job is appropriate for remote work or not. Preliminary results show that, around %25 of the total jobs can be performed remotely in Turkey with high variation across regions. Finally, changing composition of work force and possible future policy implications will be discussed with respect to related literature.Effectiveness of Monetary Policy in Egypt during Crisis Time: Global Financial Crisis versus COVID-19 Pandemic
Abstract
Egypt has been exposed to two recent shocks; the global financial crisis of 2008 and the COVID-19 Pandemic of 2020. Though the origin and the implications of the two shocks are quite different, they bear some similarities in terms of the sharp decline in global economic growth, negative implication on the Egyptian economy and monetary response. Prior to the 2008 crisis, Egypt achieved high GDP growth rates. In response to the crisis, the CBE affirmed its guarantee to all deposits in the banking sector, cut its corridor spread rates by 250 basis points in 2009, and facilitates banks’ financing to SMEs. Thanks to Egypt’s limited integration in international financial markets, its solid economic fundamentals and policy responses, Egypt’s growth prospects were not severely affected by the crisis. More than a decade after 2008 crisis, the outbreak of the COVID-19 pandemic has resulted in severe economic fallout. Prior to the pandemic, Egypt succeeded in implementing comprehensive reform program and achieved one of its highest growth rates. Thus, Egyptian authorities responded proactively to the shock and various counter measures have been put in place. On the monetary front, The CBE eased monetary policy by increasing liquidity, lowering key interest rates by 300 bps and providing subsidized loans and debt relief to vulnerable sectors like tourism. Moreover, the CBE launched a stock purchase program of 20 billion Egyptian pound to support the stock market. The present paper attempts to assess the effectiveness of monetary policy in Egypt during crisis time. To this end, Egypt’s monetary response to the global financial crisis of 2008 and the COVID-19 pandemic is deeply analysed; besides, quantitative econometric techniques are employed to assess the degree of cyclicality of monetary policy in Egypt in general and during the two aforementioned crisis in specific.JEL Classifications
- E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
- H8 - Miscellaneous Issues