GCC sees growth despite uncertain global market
A new forecast by the International Monetary Fund (IMF) has stated that economic growth in the GCC is expected to reach 2.4% in 2018, with further growth anticipated in 2019.
The report states that the growth “...is mainly due to the implementation of public investment projects, including those consistent with the five-year development plan in Kuwait and ongoing preparations for Expo 2020 in the UAE.”
In the aforementioned UAE, GDP growth is estimated to rise from 0.8% (as recorded in 2017) to 2.9% in 2018 and 3.7% in 2019.
Saudi Arabia is also set to see over a percentage point increase in 2018, with a total of 2.4% by in 2019.
The standout state is Oman, which is set to witness a 5% growth by 2019.
Despite the positive news, the IMF did strike a cautionary note in the report however, stating: “The growth outlook for oil exporters remains subject to significant uncertainty about the future path of oil prices.
“Oil exporters would be exposed to a slowdown in economic activity in China, the euro area, and the United States, given the concentration of their oil exports to these countries, as well as the impact of lower oil prices triggered by a slowdown in global growth.”
Jihad Azour, Director of the IMF’s Middle East and Central Asia Department, said: “The changing global economic environment is bringing new challenges for the region.
“Near-term prospects for oil exporters in the MENA region have improved modestly on the back of higher oil prices and a slower pace of fiscal consolidation.
“Risks from escalating global trade tensions, further tightening of financial conditions, the oil price trajectory, and geopolitical developments cloud the outlook.”
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