Essay on Global Financial Crisis in Middle East

Essay on Global Financial Crisis in Middle East Global Financial Crisis and Equity Markets in Middle East Countries Mar 26, 2018 in Economics Introduction Although there have been many financial crises in the history of the world economy, the financial crisis that occurred between 2008 and 2009 was one of the most influential. This crisis had a bigger magnitude and was of a different nature. According to Onour (2010), global market equities dropped to all-time low of 22% by the end of February 2009 from 51% in 2007. This was 56% drop in the value of equity markets, a situation, which had never been witnessed before. The level of risk exposure to this crisis of countries in the Middle East differed from country to country. Some countries in the region were affected more than others. Countries such as Saudi Arabia, United Arab Emirates, Kuwait, and Qatar, which had been investing more actively in foreign assets such as bonds in the United States of America, were adversely affected by this decline in the value of stocks. Although only few banks in the Gulf Corporation dared to publicly admit they experienced losses as a result of this, facts show that many were affected as they invested heavily in equity markets. This spillover effect of equity markets affected many aspects of the economy of these countries (World Bank, 2011).