Non-oil growth to hit around 4%
The GCC is expected to post economic growth of 2.3% in 2019, a marginal improvement on the previous year of 0.3 percentage points, according to ICAEW’s latest Economic Insight report.
The Economic Insight: Middle East Q1 2019 states that the GCC is still reliant on oil, despite drives to diversify economies.
Mohamed Bardastani, ICAEW economic advisor and senior economist for Middle East at Oxford Economics, said: “As lower oil prices and production cuts hit the GCC, the non-oil sector will be the main growth engine in 2019.
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“Recent oil market volatility highlights the region’s need for continued economic diversification efforts, including fiscal and structural reforms.
“GCC governments will have to play an ever growing role in stimulating economic growth in 2019.”
The oil sector will also be dampened by lower oil prices, which are forecast at US$64 per barrel in 2019, down by $7 per barrel from the average in 2018.
The non-oil sector in the GCC is expected to be the primary engine of growth in 2019, and is forecast to grow by 3.1%.
Read more: Abu Dhabi Sees GDP Jump in 2018