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02 December 2023

Large assets keep GCC off unrest: report

By Staff

Gulf oil producers are unlikely to be infected by unrest sweeping through the Arab region given their massive foreign assets which allow them to tackle economic hardships and maintain their people’s high living standards, a French bank has said.

Credit Agricole said the close relationship between leaders in the six-nation Gulf Cooperation Council (GCC) and their citizens also contribute to their immunity from such popular revolts.

In a study about the crisis in Egypt, the most populous Arab nation, the Bank said it believes the Middle East is changing and the “status quo politics” between rulers and people is no longer obvious in many parts of the region as the “pacts are neither clear nor obvious.”

It stressed that Arab governments will have to become more attentive and address fundamental and basic needs such as jobs, affordable food, more equitable distribution, governance and voice.

“The Gulf countries are better placed to adjust macroeconomic necessities in a far more resilient way than oil importers and the republics due to their smaller populations, foreign assets and rising oil revenues,” the study said.

“The Gulf countries have far deeper pockets to tap into without disturbing their fiscal and macroeconomic prudence…. moreover, Gulf monarchs are far less distant from society than the republics due to size but also style.”

Given their massive financial assets abroad, Gulf nations “would be able and willing to provide fiscal support and economic assistance to safeguard the economic stability of Egypt,” it added.

“There are historical links between Egypt and the Gulf as well as business and familial ties.”