The Chairman of the Board of Directors of “PWC” Middle East, Riyadh Al-Najjar, said that expectations of a slowdown in the growth rate in the Gulf Cooperation Council countries to 3.2% in 2023 are good compared to the decline in the global growth rate, which reached 2.8%.
Al-Najjar added, “The expected growth rate in the GCC countries is still better than some of the more advanced economies, which recorded a growth rate of 1.3% during the year.”
The economist confirmed that the non-oil economy in the GCC countries will grow by 4.2%, according to the expectations of the International Monetary Fund, despite fears of a global recession, according to what came in an interview with Al Arabiya channel today, Thursday.
“These expectations give positive indications of the region’s leadership in the direction of economic recovery, despite the challenges facing the global market, and support for that transition to clean energy, a goal that it can achieve because of its important position on the global energy market map, as these countries set the goal of achieving “zero energy.” emissions, and the GCC states attach great importance to non-oil sectors and diversifying the economy and sources of income,” according to al-Najjar.
He stressed the importance of the positive aspect in governments continuing to spend on initiatives and strategic vertical sectors to support economic growth, especially in Saudi Arabia, where the tourism sector had a strong performance, in addition to the expectations of about 25 million visitors to the Kingdom this year.
Regarding what is happening in the world and its impact on oil prices in the GCC countries, Al-Najjar stressed that oil prices have reached their lowest level this year at $75 a barrel, stressing that the breakeven price for a barrel of Saudi oil ranges between $75 and $80 a barrel, according to the International Monetary Fund’s forecasts.
According to the Chairman of the Board of Directors of “PWC”, the positive side of the Gulf economy is represented in the expectations of continued government spending, given the economic goals set by the GCC countries that require investment and increased spending, especially as they collected financial surpluses from the recent oil boom and invested them to diversify the economy and increase growth. All these data indicate that the price of oil, as well as the volume of production, is expected to be higher than what is happening now.
Al-Najjar attributed the decline in oil prices to a state of uncertainty dominating the energy markets due to the prevailing global challenges and fears of a recession, expecting that this negative picture will fade in the second half of 2023.