Arab Nations Urged to Enhance Financial Sectors and Promote Regional Integration
Arab Monetary Fund (AMF) Director-General and Board Chairman Dr. Abdul Rahman Bin Abdullah Al Humaidi has stated that the AMF’s projections show a forecasted growth rate of about 3.4% for Arab economies in 2023, with expectations that this figure will rise to 4% in 2024.
Al Humaidi stressed the need for Arab governments to accelerate their efforts to achieve digital transformation and move towards a knowledge-based economy in his speech at the opening of the Arab Banking Conference 2023, which got underway on Monday in Riyadh. The conference’s theme was “Arab Economic Outlook in Light of International Changes,” and Al Humaidi noted that Arab nations with higher levels of digital readiness were those that recovered more quickly from the COVID-19 fallout.
He also emphasized the significance of stepping up efforts to expand the financial and banking sectors in Arab nations, improve domestic capital markets, expand access to loans and financial services, and encourage regional financial integration.
Due to its increased liquidity and solvency levels, compliance with Basel III capital and liquidity requirements, and adoption of International Financial Reporting Standard (IFRS) 9, as well as improved effective banking supervision capacities that are in line with the best international standards and practices, the Arab banking system has become better equipped to absorb and withstand financial and economic shocks and risks, according to him.
Al Humaidi stated that with assets totaling almost $4.1 trillion, or 124% of the combined Gross Domestic Product (GDP) of Arab nations, the banking industry in Arab countries is their principal source of economic liquidity.
He continued, noting that the Arab banking sector is notable for its high solvency, with the average capital adequacy ratio reaching 17.4 percent at the end of 2022, reflecting the role of Arab central banks in maintaining financial stability. The sector has generally remained stable and capable of withstanding shocks thanks to its good levels of capital, asset quality, and profitability.
