A report by CEBR for the Institute of Chartered Accountants of England and Wales (ICAEW)
Economic Insight: Middle East is produced by Cebr (The Centre for Economics and Business Research), ICAEW’s partner and economic adviser. The report provides ICAEW’s 140,000 members with a snapshot of the region’s current economic performance and the outlook for the years ahead. The review focuses on the Gulf Cooperation Council (GCC) member countries (United Arab Emirates, Bahrain, Saudi Arabia, Oman, Qatar and Kuwait), along with Egypt, Iran, Iraq, Jordan and Lebanon.
In the latest report, Cebr emphasised that:
- Although the pace of economic expansion in the Middle East is expected to slow from the robust rate experienced over the last two years, growth continues to outpace that of the world economy as a whole thanks to booming public sector spending and resilient oil prices. Growth across the GCC in 2012 averaged 6.0%, but is expected to slow to 4.8% in 2013.
- The population of the region is growing at an unprecedented rate, with the population expected to have more than doubled between 1990 and 2030. This provides an opportunity, offering both a larger market place to attract investment and a growing labour force.
- The major challenge of a growing population, however, is the need to provide employment. While in GCC countries states have expanded government spending to provide jobs, elsewhere in the region unemployment is high and remains a potential source of political turmoil.
- While government spending and oil revenue may drive growth in the short run, in the long term improving productivity should be a high priority across the region.