Growth is forecast to be strong in Bahrain and other GCC countries, despite unrest in the region, said the International Monetary Fund (IMF).

In its semi-annual World Economic Outlook released yesterday (October 7), the IMF said the Middle East and North African (Mena) region would grow by 2.6 per cent this year, reported the Gulf Daily News (GDN), our sister publication.

“With increased strife in some countries in the region, the projected pickup in growth in 2014 ... is now projected to be weaker relative” to the April forecast, the IMF said.

“Growth is expected to increase in 2015, assuming that security improves, allowing for a recovery in oil production, particularly in Libya,” it said.

The most spectacular drop is expected in Iraq, whose economy is being hit hard by the conflict between a US-led coalition and the Islamic State group.

The IMF now expects growth to hit 2.7 per cent this year after it was forecast to grow by 5.9 per cent. And oil-dependent Iraq is seen growing only 1.5 per cent next year.

For oil exporters as a whole '“ the GCC, as well as Algeria, Iraq, Iran, Libya and Yemen '“ the IMF predicted 2014 growth rate at 2.5 per cent.

The IMF said growth in the GCC is projected to remain strong at 4.5 per cent in 2014 and 2015.

However, it warned of oil price fluctuations due to weaker demand and increased non-Opec production, particularly from the US. - TradeArabia News Service