By: Mohamed Idris
Riyadh – Mubasher: It is not possible to predict when the GCC economy will be restored to its former glory, International Monetary Fund (IMF) managing director has said at the Annual Joint Meeting of the GCC Ministers of Finance.
GCC member states should facilitate processes for the private sector and for investment and development in various fields, Christine Lagarde said late Wednesday.
Should oil prices rise once more, GCC economies will become better and stronger, she added.
Speaking to Mubasher, the IMF top official stated that it was important for countries to be able to keep up with new developments, so that the economy is not dependent on a single commodity.
There should be diverse sources to bolster the economy, and individuals, including women, should be able to support their economies, she added.
“Saudi Arabia has begun a major policy shift to respond to low oil prices. Vision 2030 and the National Transformation Programme (NTP) contain ambitious policy reforms to reduce the economy’s reliance on oil, strengthen non-oil growth, and increase employment opportunities,” Lagarde said during the event.
Since the oil price drop in mid-2014, economic growth slowed in Saudi Arabia and the GCC.
GCC growth is expected to reach 1.7% in 2016 and 2.3% in 2017, compared to 3.4% in 2015, the official noted.
The IMF managing director further said that while GCC member states have already begun taking steps to maintain the situation, more reforms are needed in order to gradually reduce budget deficits.
Since the oil price decline, GCC countries began raising local fuel prices, cutting growth of public sector wages, and reducing government spending.
“Over the past year, the IMF has further strengthened its relationship with the GCC countries through our regular country visits, our technical assistance, and our training program. The IMF stands ready to continue to support the GCC countries in addressing their challenge of adjusting to the lower oil price environment,” Lagarde concluded.
Translated by: Nada Adel Sobhi
