MUSCAT: The COVID-19 pandemic has prompted the Gulf Cooperation Council (GCC) countries to undertake necessary economic reforms and shift towards economic diversification, a report by the Washington Institute for Near East Policy stated.
In a new report published on its website, the institute said that oil resources have brought about unprecedented developments in Gulf society, but these successes have been marred by what is known as the ‘oil curse’. However, the past several years have given the Gulf region an opportunity to change course.
The report stated that the gains achieved by the Gulf countries over the past decades were due to their oil wealth, which was enormous, especially with regard to the development of reliable infrastructure, and the progress made in economic and social issues.
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However, the report added, the Gulf region is also suffering from the negative repercussions of oil, which has prevented the diversification of economic activities and the provision of incentives to compete in foreign markets.
The report further said that after negative economic growth of non-oil activities in the Gulf Cooperation Council countries as a result of the pandemic in 2020, the International Monetary Fund estimated about 2.5% in Saudi Arabia, 6% in each of the United Arab Emirates and Bahrain, and 3.9% in the Sultanate of Oman, And 2.7% in Qatar, and 9% in Kuwait. All of these countries regained positive growth during 2021, estimated at 4.9% in the Kingdom of Saudi Arabia, 2.8% in Bahrain, 2.7% in each of the Sultanate of Oman and Qatar, and 2.2% in Emirates and 1.8% in Kuwait.
Despite the deterioration of the situation again as a result of the continuation of the pandemic and the war in Ukraine, it is not excluded that the Arab Gulf states will benefit from the rise in oil and natural gas prices, in conjunction with the return of transport and tourism, which gives a strong impetus to the economy in its various components.
The Gulf countries should view this period as an opportunity to continue the work that began in 2014, as most of the Gulf oil-producing countries have pursued economic reform and diversification strategies for many years.
