Conference Paper
The Greater Beast: Weather-related and Health Disasters in MENA
No.
ERF29AC_60
Publisher
ERF
Date
May, 2023
Economic growth is a major source of concern in light of the successive weather-related and health disasters. We estimate the contemporaneous and long-run effects of weather-related vis-à-vis health disasters on the economic growth of 21 Middle East and North Africa (MENA) economies during 1980-2021 using two-way fixed-effects and two-step system general method of moments strategies. We also examine if macroeconomic fundamentals and domestic resource mobilization and external financing act as efficient mitigators of disaster effects. We find that the occurrence and damage of weather-related disasters decreases growth, respectively, by 1.1 and 2.0 percentage points instantaneously and by 11.7, and 3.4 percentage points, after one year. Health disasters occurrence and affected people measures are reducing growth in the short run by 2.0 and 0.3 percentage points, respectivelyand by 22.3, and 5.4 percentage points, after one year. Our estimates indicate that domestic resources from sovereign wealth funds can help mitigate all types of disasters. This study emphasizes the significance of domestic resource mobilization vis-à-vis external sources of finance in times of disasters.
Research Associates
Eman Moustafa
Research Manager, African Export-Import Bank (Afreximbank)
Research Associates
Amira El-Shal
Acting Associate Director of Research, J-PAL MENA