Worst is over, GCC economic recovery picks up steam

Worst is over, GCC economic recovery picks up steam

Economists say that the worst is behind us as recovery gains ground - steadily, albeit at a slow pace - with GCC countries emerging from the deepest part of the contraction due to Covid-19 in the second quarter on the easing of virus containment measures and higher oil prices.

However, the pace of economic recovery will likely be gradual and dampened by the need for tighter fiscal policy, job losses and external weakness. Oil prices remain well below the level needed to balance GCC budgets, and policies have largely shifted towards fiscal consolidation aimed at limiting the size of deficits, said Monica Malik, chief economist of Abu Dhabi Commercial Bank (ADCB).

During the second quarter, GCC governments announced lockdowns and