The International Monetary Fund (IMF) said on Wednesday that the GCC member states should plan to exit their high fiscal spending policies in light of their US dollar pegs and exposure to oil cycle volatility, as they have successfully weathered the financial crisis and are poised to continue to grow their economies despite ongoing economic uncertainty. See clip from RTTNews below.
| (RTTNews) - The six-member Gulf Cooperation Council should prepare an exit strategy from current high spending levels, to ensure long term fiscal sustainability, which would be implemented once conditions allow, the International Monetary Fund said Wednesday. |
| According to IMF, the impact of spillovers from financial developments in Dubai and Greece should continue to have a limited effect on the GCC nations and substantial foreign assets are available to mitigate the impact of new shocks. GCC states include Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates. |
| Banks’ capital adequacy ratios remain strong and there are positive indications on profitability. |
| Further, the IMF said supported by strong fiscal spending and the global recovery, growth is projected to strengthen in 2010. Non-oil growth is estimated to strengthen to around 4.3%. In line with global recovery, oil output is projected to rebound by approximately 4.8% this year. |
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July 23rd, 2010
Posted in Economy, Industrial investment, Regional News | 
Tags: dollar peg, economic growth, GCC, Gulf Cooperation Council, IMF, oil cycle