The Potential Influence of COVID-19 on the Arab World Economy
Keywords:
COVID-19, Forecasting, LSTM, RNN, ARIMA ModelAbstract
This paper predicts Coronavirus Disease (COVID-19)'s potential influence on the Arab country's economy by using two predicting models: the Autoregressive Integrated Moving Average (ARIMA) model and Long Short-Term Memory (LSTM) model. The World Bank offers data of the Arab countries' Gross Domestic Product (GDP) over the period 1968-2019. As we show up at the pinnacle of the COVID-19 pandemic, quite possibly the most critical inquiry going up against us is: what is the potential impact of the pandemic on the rate of GDP in Arab countries during the pandemic period? LSTM is recurrent neural networks (RNN), which are competent in understanding temporal dependencies. Therefore, the model based on LSTM achieved a great fit with the real data, which is what made us rely on its results more than the ARIMA model. The results of the LSTM model showed that the COVID-19 pandemic caused a decrease in GDP by approximately 17.22% and 5.41% in 2020 and 2021, respectively, with respect to the real GDP announced by the World Bank. In addition, we trained the LSTM-based model on real data from 1968 to 2020 and predicted the GDP growth rate in the next five years until 2025. Thus, what is certain now is that the Arab world states have to encounter the challenges presented by the current ecosystem. Transition to digital economy is needed, additional volume of data with high-level accuracy is required to improve precise and robust models to attain projections with a reduced amount of margin of error.
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