The Political Economy of Eastern Mediterranean

Abstract

This article analyses the political economy of the Eastern Mediterranean under the prism of the current international economic crisis. The international economic crisis, which firstly manifested in 2007, directly affected certain economies of Eastern Mediterranean. For this purpose, initially we analyse macroeconomic indicators which capture the economic position of Eastern Mediterranean countries in the international economic system. In particular, we study the macroeconomic indicators for evaluating the prospects of these countries as follows: GDP, GDP per capita, GDP growth, central government gross debt, net lending (+)/net borrowing (−), inflation, unemployment, and current account balance. Then, we analyse bilateral economic relations among Eastern Mediterranean countries in order to highlight their degree of economic interdependence. In particular, our analysis focuses on trade relations among countries, net inflows of foreign direct investment and the critical role of energy. Finally, we attempt to identify further prospects for economic cooperation among Eastern Mediterranean countries in the current highly uncertain global economic and political environment.