A scoping review of COVID-19 economic response policies in the MENA countries: lessons learned for Iran for future pandemics

Abstract

Background

Given the significant impact of the COVID-19 pandemic, it is imperative to examine the economic response policies implemented by governments. This study aims to review evidence from the Middle East and North Africa (MENA) region, including Iran, on COVID-19 economic response policies designed to protect households, vulnerable groups, and businesses.

Methods

Utilizing Arksey and O’Malley’s scoping review methodology, electronic search engines and databases were systematically searched to identify published studies within the timeframe of December 31, 2019, to 2022. Additionally, a gray literature search for relevant policy documents and reports was conducted. The following six-step approach was employed: (1) defining the review questions, (2) identifying relevant studies through database searches, (3) screening studies for inclusion, (4) extracting and charting data, (5) analyzing and presenting results, and (6) providing guidance and suggestions. Narrative synthesis was utilized for data analysis.

Results

After a rigorous screening process, 53 studies were selected from a pool of 3392 search results. The findings are categorized into three primary groups: Households, vulnerable groups, and economic businesses. The majority of MENA countries implemented economic and social measures to support these groups, including stimulus packages, tax deferrals and exemptions, wage subsidies, and debt obligation deferments. The size of stimulus packages in MENA countries varied significantly, ranging from 0 to 14% of real Gross Domestic Product (GDP). The average stimulus package size in MENA countries was 3.67%, notably lower than the global average of 11%. Among the 64 selected countries, the average government support as a share of GDP was 6.3%, with Ecuador at the lowest (0.05%) and Germany at the highest (23%). In Iran, government financial support contributed approximately 7% to the Gross National Product.

Conclusion

MENA countries, including Iran, implemented diverse economic strategies and policies in response to the critical circumstances of the COVID-19 pandemic, tailored to their specific conditions. Assessing the effectiveness of these policies and the extent of the pandemic’s long-term economic, health, and lifestyle impacts requires a more extended timeframe.

Introduction

The global outbreak of COVID-19, originating in Wuhan, China, led to a worldwide pandemic [1]. The World Health Organization (WHO) subsequently declared COVID-19 a public health emergency of international concern [2]. The widespread transmission and evolution of COVID-19 have hindered global economic development and posed significant public health challenges [3, 4]. The global spread of COVID-19 has had profound economic consequences, including increased global economic uncertainty and subsequent fluctuations in financial markets and stock prices [5]. According to the World Bank (WB), the COVID-19 pandemic could push approximately 13.5% of the world’s population into unemployment and 28 million people into extreme poverty [6]. The pandemic has affected countries worldwide, as exemplified by the reduction in oil production in Nigeria, Angola, and Chad, ranging from 5.2 to 17.8% compared to non-COVID-19 years [7].

During the pandemic, global markets experienced rapid shifts, and industrial trade via air, road, and rail was significantly curtailed [8]. A survey conducted by the British Plastics Federation (BPF) revealed that COVID-19 was significantly affecting manufacturing businesses in the United Kingdom (UK), with 98% of respondents expressing concerns about its negative impact on operations [9]. The COVID-19 pandemic had a profound impact on societies, businesses, organizations, financial markets, and the global economy, with uncoordinated government activities, such as quarantines, disrupting supply chains [10]. The socioeconomic impacts of the COVID-19 pandemic varied across sectors, with particularly negative effects on sectors reliant on informal employment [11].

The MENA region is a diverse group of countries, encompassing high-, upper-middle-, and lower-middle-income nations [12]. The region’s highly informal workforce, accounting for 56.3% of employment in North Africa and 63.9% in the Middle East, left millions vulnerable to income losses and with limited social protection [13]. Iran, the seventeenth-largest country in the MENA region, faced diverse environmental and socioeconomic conditions [14]. With a population of approximately 86 million, of which 61 million reside in urban areas, Iran’s response to the COVID-19 pandemic was influenced by various economic, cultural, political, and ethical factors [15, 16]. This study aimed to review evidence from MENA countries and Iran on COVID-19 economic response policies designed to protect households, vulnerable groups, and businesses.

Methods

Study design

This scoping review employed the methodological framework proposed by Arksey and O’Malley [17]. This framework consists of six key steps, as follows:

Identifying the questions of review

The primary research question for this scoping review was: ‘What are the economic strategies adopted by selected MENA countries and Iran during the COVID-19 pandemic?’ This question encompassed the following specific areas:

• General specifications and published studies or reports related to the topic.

• Government economic response policies for businesses during the COVID-19 pandemic in MENA countries.

• Economic policies implemented by MENA countries with varying income levels to support target groups, including households and vulnerable populations.

• Economic policies implemented by the Iranian government at the national level in response to the COVID-19 pandemic”.

Identifying the studies through resources

A comprehensive literature search was conducted using English-language databases, including PubMed, Scopus, Web of Science, ScienceDirect, Cochrane Library, and Embase. Additionally, Persian-language databases such as IranMedex, Irandoc, Magiran, SID, and Medlib were searched. The inclusion criteria were limited to research published in English or Persian. To supplement the identified studies, Google Scholar, reference lists of included studies, gray literature (unpublished evidence and documents), and relevant websites were also searched.

A combination of keywords and Medical Subject Headings (MeSH) was employed, including COVID-19, Coronavirus, Novel coronavirus, 2019-nCoV, Wuhan coronavirus, SARS-CoV-2, SARS2, Economic support, and Economic policy. Boolean operators (AND, OR, and NOT) were used to refine the search. All searches were conducted within the titles and abstracts of studies. The search strategy was adapted for each online database, and EndNote X8 was used to manage the identified studies.

Table 1 outlines the inclusion and exclusion criteria used to screen the identified studies. The cutoff date of December 31, 2019, was selected to coincide with the emergence of COVID-19 in Wuhan, Hubei Province, China.

Table 1 Study inclusion and exclusion criteria

Process of screening

Two authors independently screened the titles and abstracts of all identified studies. During the full-text screening phase, one author conducted a comprehensive review of each study, making a decision to include or exclude it. A second author then reviewed the list of studies to be included or excluded, and consensus was reached. In cases of disagreement, the study was retained for review by a third author with additional expertise and experience.

Data extraction from included studies

A standardized data extraction form was developed using Microsoft Word (Version 2019). The following data were extracted from the included studies: title, authors, references, publication year, setting (country), study type, participant characteristics, and key findings related to economic response policies in MENA countries.

Analysis and reporting of results

Narrative synthesis was employed to summarize the overall evidence by comparing and contrasting the data. The summary of findings from the included studies was presented in descriptive statistics, including tables and graphs. Additionally, the economic policies of different countries were extracted and summarized in relation to the COVID-19 pandemic. Two researchers independently analyzed the data.

Providing guidance’s and suggestions

The final step in the selected methodological framework involves providing suggestions and guidance to ensure clear and applicable results. Based on the insights of the research team and the findings of the included studies, guidance was provided in the form of discussions, conclusions, and research and operational recommendations.

Results

Search results

A comprehensive search identified 3392 records. After initial screening of titles and abstracts, 82 articles were selected for full-text review. Based on predefined criteria, 53 studies were included in the evidence synthesis phase. Figure 1 provides a detailed illustration of the search and selection process.

Fig. 1

PRISMA Flow Diagram of search process

Main findings

The results indicate that all countries implemented varying levels of fiscal measures, including stimulus packages, tax deferrals and breaks, wage subsidies, and debt deferrals. The size of stimulus packages in MENA countries ranged from 0 to 14% of real Gross Domestic Product (GDP). The average stimulus package size in MENA countries was 3.67%, significantly lower than the global average of 11%. Among the countries of the Gulf Cooperation Council (GCC), the average stimulus package size was slightly higher, reaching approximately 6%. Qatar, a high-income country, demonstrated a notably strong financial response, with a stimulus package size of 14%.

Economic response policies of countries

Fiscal responses in the Middle East and North Africa region were generally consistent with those of other emerging economies. Based on the analysis of selected studies, Table 2 presents the government’s economic strategy for businesses during the COVID-19 pandemic. Key themes related to economic policies in the MENA region include labor market support, trade and supply chain plans, support from other countries, appropriate financial responses, and monetary policy measures. Table 3 summarizes the economic policies implemented by selected countries with varying income levels to support target groups, including households and vulnerable populations, during the COVID-19 pandemic.

Table 2 Economic response policies to support businesses in included studies

Table 3 Economic response policies to support households and vulnerable people in included studies

Economic policy responses to the COVID-19 pandemic

Figure 2 illustrates the economic policy responses of various countries to the COVID-19 pandemic. All countries implemented financial support for active companies as part of their response strategies.

Fig. 2

Contribution of countries to the use of economic policy responses to the COVID-19 pandemic

Discussion

This scoping review identified COVID-19 economic response policies implemented at the MENA country and Iranian national levels to protect households, vulnerable groups, and businesses. Understanding successful economic policies and their potential adaptation for Iran could contribute to the effective management of similar diseases.

The findings indicate that governments in the MENA region employed various strategies to support businesses during the COVID-19 pandemic, including labor market support, trade and supply chain plans, international support, appropriate financial responses, and monetary policies. Lebanon, already hosting a significant number of migrant workers due to economic and political crises, had a particularly vulnerable population, with over 50% of its workforce engaged in the informal sector prior to the COVID-19 pandemic [18]. As part of its economic response plan, Canada, an OECD country, provided financial support to employers severely affected by the pandemic [19]. Small and medium-sized enterprises (SMEs) generally exhibit less resilience and flexibility in managing pandemic-related costs compared to larger firms [20].

During pandemics, small and medium-sized enterprises, often lacking the technical resources of larger companies, are particularly vulnerable to rapid economic shifts. Government policies should prioritize support for these businesses [21]. The findings indicate that the strategies implemented to support businesses during the COVID-19 pandemic were consistent with global approaches, encompassing fiscal, monetary, and trade policies. Examples include fiscal stimulus packages, bailouts to ensure business continuity, cash transfers, wage subsidies, and tax rebates [22, 23].

The neoliberal economic approach prevalent in many MENA countries has resulted in decades of high debt and austerity [3]. In this countries, limited public spending and regressive taxation have disproportionately impacted vulnerable populations, leaving them with inadequate access to public services and social protection [24]. For instance, compared to other countries, the Lebanese government had limited capacity to implement subsidy programs or financial support and resorted to incentivizing employers to retain or compensate their workforce [25]. In addition, Egypt, compared to the Persian Gulf countries, also faced financial limitations in its economic response to the COVID-19 pandemic. Egypt’s foreign debt portfolio steadily increased from $48 billion before the crisis to over $134.8 billion in 2021 [11].

Households and vulnerable populations are significantly impacted by epidemics like COVID-19 and other emergencies. Governments have implemented various initiatives to protect these groups from the economic pressures of COVID-19, which can serve as valuable lessons for future crises. The World Bank has recommended several pre-crisis policies, including “conditional cash transfers (CCTs), school feeding programs, other food programs, family allowances and child benefits, social pensions, disability benefits, funeral allowances, education benefits, special benefits, emergency benefits, and other social safety network programs” [26]. Also, the immediate responses to the COVID-19 crisis are aligned with the overall International Labour Organization (ILO) policy framework for coping with the COVID-19 pandemic in the world of work. This framework has four interconnected pillars: “Pillar 1 – Stimulating the economy and employment (at the macro and sectoral level); Pillar 2 – Supporting enterprises, jobs and incomes (at the meso level); Pillar 3 – Protecting workers in the workplace (micro level); and Pillar 4 – Relying on social dialogue for solutions (crosscutting).” [27].

During the COVID-19 outbreak, OECD economies experienced a severe crisis characterized by increased unemployment, job losses, and decreased household income [28]. In response, OECD countries implemented a range of strategies, with a primary focus on financial support for businesses, unemployed individuals, and quarantined workers [29].

During the COVID-19 pandemic, 67% of the total economic approvals by the Iranian government were related to financial policy, while 33% were related to monetary policy [30]. Therefore, the dominant approach in the government’s economic response was the use of financial policy tools to address the negative economic effects of the coronavirus epidemic. As a MENA country, Iran faced several challenges in managing the COVID-19 pandemic, including a lack of sufficient funding and financial support for implementing interventions, particularly due to sanctions and economic pressures [31]. Economic sanctions have harmful effects on public health in Iran, emphasizing the importance of planning, standardization, and improving the quality of care for COVID-19 management [32]. To enhance the economic response to emergency situations, it is imperative to implement appropriate management strategies and pursue international solutions and interactions to address existing sanctions.

Limitations

This scoping review has several limitations. Studies published in languages other than English and Persian, such as those from Spain, Italy, France, China, and Brazil, were excluded. Additionally, the collection of economic and social policy data for the countries was generally stated, lacking specific details for each country. It was not feasible to compare countries based solely on societal conditions and COVID-19 management strategies. Furthermore, there was limited access to unpublished evidence on economic policies during the COVID-19 pandemic in some countries.

Conclusion

This scoping review offers a comprehensive exploration of COVID-19 economic response policies implemented at the MENA country and Iranian national levels to safeguard households, vulnerable groups, and businesses. To mitigate the effects of the COVID-19 pandemic, most of the selected governments adopted various economic measures aimed at protecting these groups. The specific conditions of each country influenced the implementation of these policies. For example, Lebanon and Egypt were grappling with economic crises, while Iran faced sanctions. These countries employed varying levels of fiscal measures, including stimulus packages, tax deferrals and breaks, wage subsidies, and debt deferrals. The results indicate that the size of stimulus packages in MENA countries varied significantly, ranging from 0 to 14% of real GDP. The average stimulus package size in MENA countries was 3.67%, significantly lower than the global average of 11%. MENA countries and Iran implemented diverse economic strategies and policies in response to the COVID-19 pandemic, tailored to their specific conditions, which can serve as valuable lessons for future crises. Governments and international financial institutions should collaborate to invest in a comprehensive, equitable, and rights-based economic response to the COVID-19 pandemic in the MENA region. Assessing the full extent of the economic, health, and lifestyle damages caused by the pandemic requires a longer timeframe to evaluate the effectiveness of implemented policies. Iran, in particular, faced challenges due to sanctions, which disproportionately impacted vulnerable groups. Policymakers must adopt a comprehensive approach to support these populations.

Future research’s

It is recommended that similar studies be conducted in other countries worldwide to facilitate a comparative analysis of economic policies implemented during the COVID-19 pandemic. Additionally, further research is needed to examine the relationship between the number of cases, deaths, and other complications of COVID-19 and the economic policies of countries. By learning from the experiences of the COVID-19 pandemic, studies can inform the development of appropriate economic policies for future crises. Moreover, additional research is required to elucidate the relationship between crises such as the COVID-19 pandemic and economic responses, as the short-term effectiveness of policies in many countries remains unclear. Long-term evaluations are also necessary to fully understand the implications of these policies.