The diverse fiscal and economic policies and underlying imperatives of the six GCC states have impeded previous attempts to forge a common currency. The current downturn in oil prices has highlighted the extent to which the individual members of the GCC will continue to prioritize their own, competing policy initiatives.
Because of relatively high levels of state spending, GCC members have struggled to expand their economies beyond oil and gas. The recent Arab uprisings have brought the region's long-time economic challenges back into the spotlight. The key issues each country faces and potential reform solutions broadly fall into very similar categories.
The Gulf Cooperation Council states of Saudi Arabia, Kuwait, the United Arab Emirates, Bahrain, Qatar and Oman face a potential extended downturn in global oil prices coupled with the effects of years of high state spending. This will require changes to domestic policy and budgets to match evolving economic realities.
