Consultancy on Strengthening capital market development for sustainable growth in the Arab region

Result of Service

This ultimate result will be an analytical paper which contributes to Development Account Project outcome OC1 “Countries in Arab States have increased access to tools that enhance their preparedness to develop innovative financing instruments including Climate/SDGs Debt Swap Programmes, sustainability-linked debt financing instruments, and to catalyze private finance”.

Work Location

Remote

Expected duration

6 months

Duties and Responsibilities

Background Arab states are faced with a multitude of challenges, including the lingering impacts of the pandemic, ongoing conflict and instability, climate crisis, and escalating debt. As such, capital market development is crucial for the Arab region as it provides an essential avenue for driving economic diversification, supporting infrastructure and innovation, and financing sustainable social and human development aligned with the UN Sustainable Development Goals (SDGs). Strengthening capital markets will attract foreign investment, enhance market liquidity, create employment, and contribute to improved financial stability and transparency. Countries in the region have made substantial strides in developing capital markets in recent years, driven by government reforms, economic diversification, and an increasing focus on global financial integration. Several trends and factors have shaped the evolution of capital markets in the Arab region in recent years, such as: • Large-scale economic diversification plans that emphasize reducing dependence on oil and gas and the importance of developing capital markets to facilitate investment and raise capital for financing infrastructure, innovation, and non-oil sectors. • Persistent fiscal deficit leads to increased government borrowing in the form of government bonds and securities to meet financing needs, which serve as key instruments in capital markets. • Capital markets in the region have been marked by a surge in IPO activity, raising significant capital and attracting investor interest both domestically and internationally. • Regulatory reforms to enhance market transparency, improve investor confidence, and comply with international standards. • The development of Islamic finance has had a profound impact on capital markets in the Arab region, with Sukuk (Islamic bonds) becoming a significant financial instrument used by governments and corporations for funding. • Rapid digitization of capital markets, such as blockchain for transaction transparency, automated trading systems, and artificial intelligence (AI) for market analytics. • Environmental, Social, and Governance (ESG) Investing has gained traction in the Arab region, with more investors considering sustainability factors when making investment decisions. While the region’s capital markets have experienced growth, some challenges remain: • Market volatility, especially with fluctuating oil prices impacting investor sentiment. • Geopolitical risks and conflicts that can hinder investment flows and market stability. • Liquidity issues in smaller markets. • Underdeveloped legal and regulatory frameworks in some countries that could discourage foreign investment. Duties and Responsibilities The consultant’s main duties and responsibilities include the following: • Describe the role of capital markets in supporting economic diversification, reducing dependency on oil revenues, and bolstering sustainable growth. Contextualize it in the Arab region, taking into account the diversity of country income and bond market development in the region. • Examine the current state of capital markets in the Arab region, highlighting the major challenges and opportunities faced by countries, and identifying key trends that impact the overall development of these markets. • Evaluate the potential of innovative financing instruments, such as GSS bonds to attract domestic and international investors and unlock capital for green industrial development and climate resilient projects, thus contributing to long-term sustainable development. • Present recent initiatives from Arab countries, taking into account examples from low, middle, and high-income economies, that contributed to deepening domestic capital markets, illustrating how capital market development has been effectively leveraged to address economic challenges, attract investment, and support sustainable development. • Prepare an assessment of the state of capital market development in each Arab country (preferably in a tabular form). • Customize the World Bank/IMF step-by-step roadmap to the Arab region, with the aim to strengthen domestic capital markets, taking into account the diversity of markets in the low, middle and high-income countries in the region. • Provide a summary of policy recommendations for Arab governments on strengthening domestic capital markets that are actionable, contextually relevant, and feasible within the current political and economic environment of the region

Qualifications/special skills

Master’s degree or equivalent in economics, finance, public policy, public administration, social sciences, or a related field is required. All candidates must submit a copy of the required educational degree. Incomplete applications will not be reviewed A minimum of 10 years of proven experience in analyzing financial market conditions and developing and strengthening domestic and regional financial markets is required. Expertise in macroeconomic and fiscal policy and financial market development is required. Familiarity with the political, economic, and social context of the Arab region is desirable.

Languages

English and French are the working languages of the United Nations Secretariat; and Arabic is a working language of ESCWA. For this position, Fluency in English is required. Knowledge of Arabic is desirable. Note: “Fluency” equals a rating of ‘fluent’ in all four areas (speak, read, write, and understand).

Additional Information

Not available.

No Fee

THE UNITED NATIONS DOES NOT CHARGE A FEE AT ANY STAGE OF THE RECRUITMENT PROCESS (APPLICATION, INTERVIEW MEETING, PROCESSING, OR TRAINING). THE UNITED NATIONS DOES NOT CONCERN ITSELF WITH INFORMATION ON APPLICANTS’ BANK ACCOUNTS.

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