Contents -- Preface Horst Kohler -- Acknowledgments -- 1. Economic Challenges in the Middle East and North Africa-An Overview Zubair Iqbal -- Part I. Selected Macroeconomic and Financial Issues -- 2. Demographic Transition in the Middle East: Implications for Growth, Employment, and Housing Pierre Dhonte, Rina Bhattacharya, and Tarik Yousef -- 3. Determinants of Inflation in the Islamic Republic of Iran- A Macroeconomic Analysis Olin Liu and Olumuyiwa S. Adedeji -- 4. Financial Liberalization in Arab Countries Karim Nashashibi, Mohamad Elhage, and Annalisa Fedelino -- 5* Monetary Operations and Government Debt Management Under Islamic Banking V. Sundararajan, David Marston, and Ghiath Shabsigh -- Addendum. Recent Developments in Islamic Banking Ghiath Shabsigh -- 6. Fiscal Sustainability with Nonrenewable Resources Nigel Chalk -- Part II. External Policies -- 7. External Stability Under Alternative Nominal Exchange Rate Anchors: An Application to the Gulf Cooperation Council Countries S. Nuri Erbas, Zubair Iqbal, and Chera L. Sayers -- 8. Real Exchange Rate Behavior and Economic Growth in the Arab Republic of Egypt, Jordan, Morocco, and Tunisia Ilker Domac and Ghiath Shabsigh -- 9. Exchange Rate Unification, the Equilibrium Real Exchange Rate, and the Choice of Exchange Rate Regime: The Case of the Islamic Republic of Iran V. Sundararajan, Michel Lazare, and Sherwyn E. Williams -- Addendum. Exchange System Reforms in the Islamic Republic of Iran: A Note on Past and Current Practices Ghiath Shabsigh -- 10. Export Performance and Competitiveness in Arab Countries Karim Nashashibi, Ward Brown, and Annalisa Fedelino -- 11. The Impact of European Union Association Agreements on Mediterranean Countries Henri Ghesquiere -- Addendum. Implementation of the European Union Association Agreements Daniel Hardy, Nicole Laframboise, and Edouard Martin.

12. Estimating Trade Protection in Middle Eastern and North African Countries Maria-Angels Oliva -- List of Contributors.