GCC - $841m assets per capita
Saturday, 07 06 2019, Category: Economy, Country: Gulf Cooperation Council
As fossil-fuel substitution will not happen as fast as many believe it will, GCC economies will have the precious lead time they need to transform into post-oil economies. The combination of significant reserves of liquid assets and low debt levels can finance these regional governments' ambitious economic transformation programmes, thereby creating a plethora of opportunities for most sectors of the economy, Global management consulting firm Oliver Wyman , noted yesterday.
The Gulf economies have a strong asset position of $43.7trillion in liquid and quasi-liquid assets ($3.3trillion in sovereign wealth funds and $40.4trillion in proven oil & gas reserves) which equates to $841m in such assets per capita. This will provide the required collateral to finance the formidable economic transformation and diversification plans they are implementing, Oliver Wyman said in its report on ‘Gulf economies'.
Massive current account surpluses, relevant fiscal surpluses, and low debt levels have made the Gulf economic fundamentals among the strongest in the world. After the oil price fall of 2014, there was significant deterioration of these fundamentals. Five years on, they are weaker but have stabilised.
'Undoubtedly, the oil & gas reserves of the Gulf countries have enabled one of the biggest economic booms in human history, but this has also materialized because these countries had, and still have, the willingness to advance and improve themselves. There are several countries that have even bigger oil & gas reserves, and abundant water and farmland and yet struggle to feed their populations, commented Pedro Oliver, Regional Head (MEA) region.
Source: MENA FN