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This paper surveys the academic and policy debate on the roots of global imbalances, their role in the inception of the global crisis, and their prospects in its aftermath. The conventional view holds that global imbalances result primarily from unsustainably high demand for goods in the United States and other rich countries, and that their impending correction must involve major United States trade adjustment and dollar depreciation - although recent literature argues that their extent may be dampened by financial adjustment effects. In contrast, an alternative view portrays global imbalances as the equilibrium result of asymmetries in world asset demand and supply. Absent changes in the deep determinants of these, global imbalances can persist. International capital flow patterns before and during the crisis lend support to the equilibrium view. The paper also examines different hypotheses proposed in the literature on the role of global imbalances in the generation and propagation of the financial crisis. On the whole, the evidence suggests that global imbalances were not among the major causes of the crisis. Lastly, the paper assesses alternative scenarios about the future of global imbalances, considering in particular their potential consequences for developing countries, and the policy measures that these might adopt to enhance their growth prospects in a changing global equilibrium.

Capital flows --- Currencies and Exchange Rates --- Current account --- Current account deficit --- Current account deficits --- Current account surplus --- Debt Markets --- Depreciation --- Economic stability --- Economic Theory & Research --- Emerging Markets --- Equilibrium --- External deficit --- External deficits --- Finance and Financial Sector Development --- Financial crisis --- Global economy --- Global imbalances --- International capital flow --- Investment and Investment Climate --- Investment rates --- Macroeconomics and Economic Growth --- Oil exporting countries --- Oil-exporting countries --- Private Sector Development --- Surplus --- Surpluses --- World economy

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The July 2015 nuclear deal between Iran and Permanent Members of the UN Security Council and Germany (P5+1), with the attendant lifting of sanctions on Iran, will have significant consequences for the global, regional and national economies. First, Iran's return to the oil market, coupled with increased production from Libya (should the conflict subside) will keep world oil prices low. Secondly, once sanctions and restrictions on financial transactions are relaxed, Iran's trade, which had both declined in absolute terms and shifted away from Europe towards Asia and the Middle East, is likely to pick up. Thirdly, the Iranian economy, which has been in recession for the past two years, will receive a major boost from increased oil revenues--conservatively estimated at about USD 15 billion in the first year--and lower trade costs. This issue of the MENA Quarterly Economic Brief (QEB) traces these effects on the world oil market, on Iran's trading partners, and on the Iranian economy.

Civil War --- Conflict --- Development Economics --- Economic Model --- Economic Policy --- Growth --- International Economics and Trade --- Investment --- Macroeconomics and Economic Growth --- Nuclear Talks --- Oil Prices --- Oil-Exporting Countries --- Poverty Reduction --- Sanctions --- Trade --- Volatility --- Windfall --- China --- East Asia and the Pacific --- Europe and Central Asia --- Greece --- Iran, Islamic Republic of --- Middle East and North Africa

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Political uncertainties in the Middle East and North Africa (MENA) continue to affect the short term economic prospects in the region, while major developments in the global economy over the past six months have put the region on a two-track growth path for 2012. These developments include a significant rise in crude oil prices on fears of oil supply disruptions and weak economic activity in the Eurozone. Economic growth of MENA's oil exporting countries will be strong as it rebounds from the average of 3.4 percent in 2011 to 5.4 percent in 2012. Overall growth in the region is expected to be 4.8 percent in 2012, surpassing the 3 percent growth achieved in 2011. Improvement in the growth prospects of oil exporters is due to strength in oil markets. The fiscal situation is expected to remain tenuous for oil importing countries, especially those going through transitions. Overall, inflation is expected to remain subdued in 2012, with the notable exceptions of Iran and Egypt. Subsidies are currently dampening currently dampening the effects of increased global food and energy prices in many MENA countries.

Accounting --- Commodities --- Deregulation --- Economic Development --- Economic Forecasting --- Economic Growth --- Electricity --- Employment --- Employment Opportunities --- Energy --- Energy Production and Transportation --- Financial Institutions --- Fiscal Policy --- Foreign Direct Investment --- Global Economy --- Governance --- Gross Domestic Product --- Inflation --- Interest Rates --- International Financial Institutions --- Investment Climate --- Job Creation --- Labor Markets --- Labor Policies --- Liberalization --- Macroeconomics and Economic Growth --- Minimum Wage --- Monetary Policy --- Natural Gas --- Oil-Exporting Countries --- Politics and Government --- Private Investment --- Private Sector --- Property Rights --- Public Investment --- Public Spending --- Recycling --- Remittances --- Severance Pay --- Social Protections and Labor --- Supply Side --- Uncertainty --- Wages --- Workers --- World Development Indicators