IMF says Gulf economies really are weaning themselves off oil

IMF says Gulf economies really are weaning themselves off oil

Governments in the energy-producing Gulf region have made progress toward diversifying their economies away from oil by opening up to private investment and breaking the taboo of collecting taxes, the head of the International Monetary Fund said.

“There is this impression that the only reason the Gulf countries are doing well is high oil and gas prices,” IMF Managing Director Kristalina Georgieva told a conference in Dubai on Monday. “This is not true.”

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Governments that were once locked into a cycle of splurging during times of high oil prices have become more careful with spending. And Georgieva also pointed to a better environment for private investments and job creation through competition.

“They have been reforming relentlessly how they raise money and how they spend money,” she said, citing a reliance on collecting taxes in a region of absolute monarchies that have historically avoided them, and more attention to public spending on education and health.

Saudi Arabia, which saw its non-oil economy grow at the fastest pace in over a year at the end of 2022, has said it wants to use its oil windfall to accelerate projects that contribute to