Mubasher: Oil revenue did not recover from the major drop took place in 2014, while governments of oil exporting countries still prefer “white elephant” projects.

The Middle Eastern countries have conducted a group of economic reforms and introduced new taxes, including the value-added tax (VAT) and excise tax, to up their revenue.

However, their governments failed to achieve a significant cut in deficit, the International Monetary Fund’s (IMF) managing director, Christine Lagarde, said in a conference held in Dubai.  

Governments in the region tend to resort to sovereign wealth funds to finance public projects instead of using the normal budget process, Lagarde added.

The top official advised oil exporters to utilise fiscal rules in order to protect their priorities, including social spending, from volatility.

The world’s economy is not heading to a recession, but global growth is at stake due to trade tension and the tightened financial environment.

The IMF lowered its expectations regarding the growth of the global economy to 3.5% from 3.7%.