World Bank: MENAAP Growth Strengthens but Women’s Workforce Potential Untapped

The World Bank’s latest economic report for the Middle East, North Africa, Afghanistan, and Pakistan (MENAAP) forecasts an improved economic outlook for the region, with growth expected to reach 2.8 percent in 2025 and 3.3 percent in 2026. The report, titled “Jobs and Women: Untapped Talent, Unrealized Growth,” highlights the region’s resilience amid global uncertainty — but warns that gender inequality in the labor market remains one of the biggest untapped drivers of growth.

According to the World Bank, MENAAP’s recovery is being propelled by stronger private investment, rebounding tourism, and non-oil sector expansion in Gulf economies. However, risks remain due to ongoing conflicts, displacement, trade policy shifts, and tight global financial conditions that could affect investment and growth momentum.

“The region’s economic outlook is improving, but to make growth more inclusive and sustainable, countries must fully leverage the potential of their people — especially women,” said Ousmane Dione, Vice President for the World Bank’s MENAAP region.

Economic Recovery Across a Divided Landscape

The report outlines a divergent recovery across the region’s subgroups. The Gulf Cooperation Council (GCC) economies — including Saudi Arabia, the United Arab Emirates, Qatar, Kuwait, Bahrain, and Oman — are expected to benefit from the gradual phasing out of voluntary oil production cuts and the continued expansion of non-oil industries such as logistics, finance, and renewable energy.

Non-GCC oil-importing countries, including Egypt, Jordan, Morocco, and Tunisia, are projected to experience steady improvements in economic activity, supported by private consumption, infrastructure investments, and recoveries in agriculture and tourism.

However, the outlook for oil-exporting developing economies, such as Iraq, Iran, and Yemen, remains fragile due to conflict, political instability, and reduced oil production. In these countries, fiscal constraints and limited diversification have restricted the benefits of regional growth.

The report cautions that geopolitical tensions, climate shocks, and weaker global trade could still derail the recovery. “Persistent uncertainty, coupled with fiscal pressures and rising debt levels, continues to limit the region’s ability to generate jobs and reduce inequality,” the report states.

Women: The Missing Engine of Economic Growth

The central theme of the World Bank’s report is the region’s massive underutilization of women’s potential in the workforce. Despite notable advances in women’s education — with female literacy and tertiary enrollment rates now among the highest in developing regions — only one in five women in MENAAP participate in the labor force. This is the lowest female participation rate in the world, far below the global average of around 50 percent.

“I urge bold action — not partial measures,” said Dione. “To unlock the full potential of women in the region, we must tackle every barrier to their inclusion with comprehensive measures. A vibrant private sector that creates jobs and transforms aspirations is key to real progress.”

The report’s analysis finds that legal, social, and institutional barriers — including restrictive labor laws, limited childcare access, gender discrimination, and deeply rooted social norms — continue to prevent women from entering and remaining in the workforce. In some economies, women face formal restrictions on employment sectors, inheritance rights, and mobility, while others struggle with workplace inequities such as unequal pay and limited promotion opportunities.

Economic Gains from Inclusion

The World Bank estimates that removing barriers to female employment could boost GDP per capita by 20 to 30 percent in countries like Egypt, Jordan, and Pakistan. Across the broader MENAAP region, closing the gender employment gap could unlock hundreds of billions of dollars in additional output over the next decade.

“Increasing female labor force participation can translate into immense economic gains,” said Roberta Gatti, Chief Economist for the MENAAP region. “No other region stands to benefit more from eliminating these constraints.”

The report highlights that when women participate equally in the economy, household incomes rise, poverty declines, and children’s education and health outcomes improve, creating long-term social benefits. Moreover, firms that employ more women in leadership positions tend to be more innovative, productive, and resilient.

Policy Pathways for Inclusion and Growth

The report outlines a multi-dimensional strategy to address both economic recovery and gender inclusion. Key recommendations include:

1. Reforming labor laws and regulations — removing restrictions on women’s employment sectors, ensuring equal pay for equal work, and enforcing anti-discrimination policies.

2. Expanding childcare and family support infrastructure, enabling women to balance professional and family responsibilities.

3. Encouraging private sector hiring of women, particularly through incentives for small and medium-sized enterprises (SMEs) that promote diversity and flexible work arrangements.

4. Investing in skills and digital training, preparing women and youth for jobs in high-growth sectors like green energy, technology, and finance.

5. Promoting financial inclusion, ensuring women have access to credit, entrepreneurship programs, and formal banking systems.

The report also calls for public-private partnerships to boost women’s participation in strategic industries. Governments can lead by example by increasing women’s representation in public administration, local governance, and public enterprise leadership.

Creating Jobs for a New Generation

The Jobs and Women report emphasizes that MENAAP’s long-term stability depends on its ability to create enough high-quality jobs for its young and growing population. Youth unemployment in the region averages over 25 percent, among the highest globally, with young women disproportionately affected.

The World Bank argues that expanding the role of women in the economy will be crucial for tackling this challenge. By promoting inclusive growth, countries can diversify their economies, improve productivity, and build resilience against external shocks.

The Road Ahead

While the region’s economic prospects are improving, the World Bank cautions that the recovery will remain uneven and vulnerable unless governments act decisively to deepen structural reforms. The path forward, it says, must include fiscal discipline, investment in human capital, and gender-inclusive growth policies.

“Sustainable development in MENAAP depends on unlocking the potential of all citizens,” said Gatti. “Empowering women to participate fully in economic life is not only a matter of fairness — it’s a fundamental economic necessity.”

As global uncertainty persists, the report concludes that the region’s most powerful driver of resilience and prosperity lies not in oil reserves or foreign investment, but in the untapped potential of its people — especially its women.