Solid Fundamentals Shield GCC Economies From Global Volatility

Gulf Arab states' solid macroeconomic and financial fundamentals will keep the region resilient in the face of global economic uncertainty, including a potential sustained drop in oil prices over the next few quarters. According to the International Monetary Fund (IMF), the members of the Gulf Cooperation Council (GCC) are expected to sustain solid economic growth over the next five years against the backdrop of low inflation and strong current account and external financial positions. Oil prices and production levels, particularly in the case of swing producers like Saudi Arabia and the United Arab Emirates, will continue to strongly contribute to economic growth, despite Gulf states' decades-long and ongoing efforts to diversify away from oil and gas production. Across the region, ongoing structural reform has helped increase the share of the non-hydrocarbon economy, though Kuwait, Qatar and Saudi Arabia remain highly reliant on oil and gas exports. By comparison, Bahrain and...