GCC Economy

Data Science and its Economic Potential for the GCC

Data is the new oil; emerging technological applications like data science, Artificial Intelligence and analytics have made data a more valuable commodity. Leveraging data science can aid in extracting valuable information from the raw data. Such insights will open up new avenues of growth in the present digital economy; Data science applications have already made some economic impact in key GCC sectors like oil and gas, finance and healthcare. The GCC governments also generates large amounts of data hence effective...

GCC Bond issuances witness an uptick in H1 2019

Bond markets in the GCC witnessed a pick-up in debt issuances during the first half of 2019 after a subdued close in the last two quarters of 2018. The rise in oil prices during the first nine months of 2018 boosted the oil revenues for GCC economies, reducing the need to tap the bond markets. Consequently, Sovereign issuances dried up in the second half of 2018. Since the start of 2015 (As of 23rd Sep 2019), the UAE and Saudi...

GCC Ridesharing and its long road!

Digital ride sharing platforms are placed within the wider framework of an emerging disruptive model that is referred to as the sharing economy. Sharing Economy refers to the business model that operates through an online platform that facilitates consumer to consumer transactions, panning across sectors including transport, warehousing, tourism and hospitality and finance among others. GCC has a thriving sharing economy primarily due to factors such as a consistent labor force, high levels of urbanization, high technology adoption rates, national...

Foreign investment in GCC equity markets – Will the inflow levels sustain after index inclusions?

GCC countries are in the process of opening their economies to make them more attractive to foreign investors. The inflow of foreign funds through FDI would augur well for diversification of these economies away from oil to reduce their large oil dependence more so because its markets are cyclical and volatile. Attracting investments in non-oil sectors through equity markets is also one of the means to achieve this goal. Foreign equity inflows into GCC capital markets is expected to rise...

Saudi Corporate Capital Spending – An Encouraging Boost to Non-Oil GDP

Capital Investment is a harbinger of future growth as the fruits from today’s investments will appear in the future. Saudi Corporate sector has invested large resources in capital expenditure in 2018 which is much higher than their total net income earned during the year. The Corporate sector as represented by 120 (non-financial) listed Companies included in Tadawul All Share Index (TASI) of Saudi Stock Market, was examined to measure change in Property, Plant & Equipment (PPE), gross of depreciation (Capex)...

Imagining a Skills Policy for the GCC

In order to keep up with the workforce needs of the time, the Gulf Cooperation Council (GCC) nations need an interdisciplinary skills policy to mobilize and deploy skills throughout the ecosystem. The skills policy needs to be interdisciplinary in terms of covering requirements, activities, responsibilities and professional tools shared by varied stakeholders, public sector agencies, the private sector, academia and small businesses. The challenges of a pragmatic skills policy for the requirements of the GCC can only evolve through several...

Is Digital Labor Contributing to Creation of Gig Economy in GCC?

The labor market is undergoing a perceptible shift from one that is characterized by stable or permanent employment to what is called a “gig economy” (BMO Wealth Management). The gig economy is one that is defined by temporary (or contracted) employment, wherein an on-demand and freelance (or contingent) workforce is the prominent working model. In the recent years, digital technology advancements and rampant economic changes (including demographic shifts) has overhauled the ‘business as usual’ status. The emergence of the gig...

Oil Price may not be the trigger for reforms

This article was originally published in Al Qabas Analyzing the historical trend of reforms in Kuwait, one can notice that financial services sector is the most regulated and therefore have experienced more reforms while sectors like healthcare and legal saw the least number of reforms. For a balanced and sustained economic growth, an even distribution of reforms across all critical sectors is a must. A popular coffee table discussion in Kuwait is to ask “when will serious reforms come to...

Can Dubai’s 3D printed building vision be a template for addressing the housing crisis in the GCC?

This article was originally published in AME Info. According to a recent study from the World Economic Forum, the Infrastructure and Urban development industry worldwide, have a stagnant productivity due to its failure to innovate as quickly as the other sectors. This has caused a negative effect on the economy, society and the environment. Despite robust economic growth and the affluent nature, the GCC region has been experiencing a housing shortage. GCC housing crisis is spurred by macroeconomic drivers like...

Why are the breakeven oil prices coming down for GCC countries?

Fiscal breakeven oil prices (in USD/bbl) Source: IMF Fiscal break-even oil price is the minimum oil price needed to meet the spending commitments of oil-exporting country while balancing its budgets [BEP = {(Government Expenditure minus Non-oil revenue)/Oil quantity produced} + per barrel cost of production] (Fiscal Breakeven Oil Price). Prior to the collapse of oil prices, fiscal break-even oil prices were rising rapidly in GCC countries, reflecting the substantial increase in government spending by an annual average of 11 per...