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Gulf Economic Growth to Reach 2.3% in 2019

Gulf Economic Growth to Reach 2.3% in 2019

Tuesday, 15 January, 2019 - 12:30
National Bank of building in Beirut, Lebanon July 18, 2016. REUTERS/ Jamal Saidi
London - Motleq Mounir
A report by the National Bank of Kuwait expected the GCC countries to reach a 2.3 percent growth in 2019 and 2.6 percent in 2020.

Non-oil growth is forecast to progress from 2.9 percent in 2018 to 3.3 percent in 2019 and 3.5 percent in 2020.

The uncertainty related to the political condition in some advanced economies is complicating the general condition, revealed the report. It added that the programs to encourage the private sector and investment in infrastructure would contribute to supporting non-oil growth to a huge extent.

Not to mention that several reforms were brought up to urge the business environment and to provide motives for foreign investments on the long run, especially in UAE that has cut down fees in several sectors including tourism and real-estate (Dubai) and permitted issuance of licenses for firms operating in free trade zones (Abu Dhabi).

Further, a law allowing 100 percent foreign ownership of companies in the UAE is now in force, up from 49 percent.

The IMF, in its October 2018 WEO, revised down its global economic outlook by 0.2 percent to peg world output growth at roughly 3.7 percent over the next two years, a decent enough pace, but noted that the balance of risks is tilted to the downside.

These are dominated by escalating trade protectionism, which has been sparked by the unresolved US-China trade tariff dispute and continued US monetary tightening-the US Federal Reserve hiked rates four times, by 25 bps each time, in 2018-with ramifications for emerging market economies and those with currencies pegged to the US dollar in terms of increased capital outflows and higher borrowing costs.

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