Tricky year ahead for Middle East economies as oil cuts bite, says IMF

Tricky year ahead for Middle East economies as oil cuts bite, says IMF

Dubai, United Arab Emirates – Back in early April, when the IMF published its world economic outlook, the assessment of the regional economy was, overall, benign.

True, GDP growth rates would be significantly down from the big oil-fuelled boom of 2022 – low rather than high single digit growth.

But the GCC economies were still forecast by the IMF to show attractive rates of growth in 2023, unlike many other parts of the world grappling with the prospect of looming recession. The idea of the Gulf swimming against the global tide could be plausibly maintained – just.

Inflation, America’s rumbling banking crisis, concerns about the resilience of China’s post-COVID recovery, and an unexpected cut in oil production by OPEC+ all raised the possibility that the Fund might come out with a gloomier report than expected.

However, Jihad Azour, director of the Middle East and Central Asia for the IMF, exclusively revealed to AGBI the region was still looking pretty good compared to the international competition.

The year would be “tricky”, in Azour’s words, and there would be “continued uncertainty” in the GCC economies as well as the broader region. But the growth rate predictions at 3.1 percent – down from 5.3 percent last year –