Future Shocks

far below the average of firms in all other regions, which ranged from 13 percent in Europe and Central Asia to 21 percent in South Asia (figure O.9, panel b). That said, MENA’s low ranking highlights a large opportunity area in the changing nature of work in the region.

Message 4: The Region Must Be Better Prepared for Future Shocks

The report’s fourth message is that as the global community starts to put COVID-19 in its rearview mirror, it does so with the knowledge that this pandemic is not over, nor is this the last one it will need to contend with. Climate change, for instance, is bound to bring with it more severe and more frequent weather events. Thus, by identifying the socioeconomic impact and other distributional effects on welfare from COVID-19, we will be better placed to ensure that future crises and disasters do not result in setbacks for hard-won gains in alleviating poverty and inequality.

It is beyond the scope of this report to make detailed recommendations for MENA countries and economies. But it is evident from our results that one critical element will be resuscitating economic activity to unlock the region’s potential, with a focus on a more conducive environment for the private sector and entrepreneurship. Another critical element is rethinking the approach to the informal sector, which engages a majority of MENA’s labor force but lacks formal contracts and insurance. In addition, three program areas stand out for countries to prioritize.

First, step up vaccination programs. In the short run, this is a top priority for MENA countries to help contain the pandemic, stimulate the economy, and protect spending on other routine health services— especially for the poor and informal workers who lack social and health insurance. Key hurdles include securing and administering vaccines to a majority of their populations, given limited vaccine manufacturing capacity and limited fiscal space. Little help can be expected from private insurance. This challenge means that vaccination programs need to be efficient and transparent. In Lebanon, for instance, reports of cronyism in the vaccine rollout have raised concerns about its fairness, which could harm international aid for financing its vaccination program (Cornish n.d.). On the other hand, the vaccine rollout in Morocco has expanded significantly, with 26.7 percent of the population fully vaccinated by July 2021 (Roser and Ortiz-Ospina 2021).

Second, boost resilience to future shocks. This focus is essential to prepare MENA for future crises and disasters. The phone surveys reviewed for this report suggest that countries with more elaborate registration systems (like Djibouti or Morocco) were able to provide better