Economy

Does Brexit pose an economic puzzle to the GCC?

Dec 18, 2018

The UK’s vote to leave the European Union caused a period of uncertainty both in the financial markets and the political environment. The UK is the fifth largest economy in the world, and the Brexit process will have major economic repercussions. This led to countries and business entities strategizing their activities to respond to Brexit.

Saudi New Bankruptcy Law

Sep 17, 2018

Saudi Arabia had no single bankruptcy law in place that prescribes procedures for businesses that face financial difficulty. The courts have traditionally refrained from declaring a debtor to be bankrupt until all feasible methods of debt enforcement are exhausted.

Turkey Crisis: Impact on GCC

Sep 04, 2018

Turkey has been making headlines these past few weeks due to the massive rate at which the Turkish currency, Lira, has been depreciating against the dollar. The economy is under stress with the International Monetary Fund (IMF) downgrading the growth forecasts from 7.1% in 2017 to 4.4% in 2018 and 4.0% in 2019. Inflation levels are reaching record highs to an annual rate of 15.9 percent in July with the Lira depreciating over 40% against the U.S dollar so far in 2018. The events unfolding in Turkey has an impact on the Gulf Cooperation Council (GCC) region through various channels in the form of bank exposures, bilateral investments, trade and tourism among others. It is important to take a ..

Oman witnesses surge in its Non-oil Exports

Jul 17, 2018

Oman witnesses surge in its Non-oil Exports. Oman´s economy is known for being highly dependent on export of Oil & Gas as it contributes to 69 percent of its total export. However, over the years, Oman’s export market is witnessing a substantial increase in non-oil exports contribution. Some of the key points addressed in this article are about the recent trends in non-oil Exports, historical data analysis, major contributing partners, and the reasons behind the surge in non-oil Exports.

The “Seesaw” Game of Saudi Liquidity

Jul 12, 2018

The Seesaw game of Saudi Liquidity. The advantages of the U.S dollar peg for Saudi Arabia have been multi-fold. It has resulted in stable export revenues, reduced transactions costs and a simple yet disciplined macroeconomic policy. This peg is especially important for Saudi Arabia as despite certain measures to diversify, their economy is dependent on oil and gas and connected activities. The oil price plunged in mid-2014, and the currency peg has been under pressure since then. The sharp drop in the price of crude oil has brought about abatement in the realized revenues by the world's top oil exporter.

The Impact of VAT on Key Kuwaiti Sectors

May 07, 2018

The Impact of VAT on Key Kuwaiti Sectors. Decrease in oil prices have led the member countries of GCC in search for alternative means of revenue. One way was to introduce a common tax called Value Added Tax (VAT) in the region. On July 09, 2017 two members of GCC, Saudi Arabia and UAE ratified the VAT framework agreement for the introduction of VAT in the region. With a tax rate of 5%, it will be applicable in the entire region with certain goods and services to be treated as zero rated or VAT exempt.