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MENAFN - Arab Times - 07/10/2012

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(MENAFN - Arab Times) IMF chief Christine Lagarde praised Gulf oil exporters on Saturday for their help in stabilising the global economy by managing oil prices, despite complaints by some Western countries that energy costs are still too high.

"It gives me an opportunity to thank the GCC countries for their ... stabilising role in the global economy because of the good monitoring and good management of oil prices ..." the International Monetary Fund's managing director said.

Lagarde was speaking at a news conference after meeting with senior officials of the Gulf Cooperation Council, which groups six wealthy oil-exporting countries - Saudi Arabia, the United Arab Emirates, Qatar, Kuwait, Bahrain and Oman.

Since OPEC ministers last met in June, Brent crude oil prices have surged about 20 percent and have hovered around 112-117 a barrel since mid-August, despite fragile economic growth in many consuming countries.

Last month, head of the International Energy Agency (IEA), which represents 28 importing countries said high oil prices were a concern for these nations.
In effort to cap high oil prices, sources told Reuters the United States is considering an emergency oil stocks release. Other members of the IEA, such as France and Great Britain, could also join the move.
The Gulf states have managed to maintain high production levels, making up for lower supplies from Iran because of sanctions, and outages in the North Sea.

Top oil-exporter Saudi Arabia's supply remained steady at 9.8 million barrels per day (bpd) in July and August, off multi-decade highs of over 10 million bpd earlier in the year.

The big three Gulf OPEC producers - Saudi Arabia, Kuwait and the United Arab Emirates - collectively increased supply by around 400,000 bpd thanks to a 600,000 bpd jump in Kuwaiti production to 3 million bpd.

Earlier this year, GCC members pledged billions of dollars in additional financial resources to he IMF, and they have promised billions more in aid to poorer Arab states since last year's uprisings in the region.
Meanwhile, Lagarde said that the economies of the oil-rich countries of the Gulf Cooperation Council will continue to enjoy high growth rates, although at reduced rates.

Lagarde, the managing director of the IMF, also praised the GCC countries' management of oil prices and reserves, and lauded their financial contribution to the transition of Arab countries following the uprisings that have rattled local economies.

"I would like to stress the important, positive role the GCC countries play in the broader Middle East and North Africa region, and the world at large," Lagarde said after a meeting of the six-nation GCC, which counts Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Bahrain and Oman as members.

"The generous financial aid the GCC has provided to some of the Arab countries undergoing transition is helping those countries through a very difficult period," she said. "And, at the global level, GCC countries' oil policy has helped stabilize oil markets and counter price pressures that could have inflicted serious damage on the world economy."

She said that while other Arab economies are challenged, the GCC countries are enjoying growth that reached its highest level in eight years in 2011 at 7.5 percent.

"Nevertheless, given the uncertain global outlook, continued emphasis on strengthening resilience, including in fiscal and financial sectors, will be important alongside greater focus on the foundations for longer-term growth," she said.

An IMF official, who spoke on condition of anonymity in line with the organization's policy, said following the GCC's strong performance in 2011, growth in the nations' non-oil sectors is expected to slow as fiscal stimulus eases, but remain high by historical standards at around 6.5 and 5.6 percent in 2012 and 2013, respectively.

Saudi Arabia is one of the largest donors to countries of the region and contributors to the IMF.

Riyadh pledged an additional 15 billion earlier this year to the IMF following the fund's call for new resources, the official said.
The discussions were held within framework of a joint meeting grouping members of the GCC Financial and Economic Committee (the ministers of finance), the Committee of Governors of GCC Central Banks and Lagarde. Kuwait was represented at the meeting by Minister of Finance Dr Nayed Al-Hajraf.

In an opening statement, Saudi Minister of Finance Dr Ibrahim Al-Assaf lauded efforts of the IMF for establishing financial and economic stability in the world, as well as supporting the member states of the international agency.

Grave challenges continue to stand in the face of nations as a result of the global crisis, and this warrants cooperation for regaining confidence in the international markets, Al-Assaf said.

He indicated that the GCC states granted financial support for countries that suffered from ramifications of the global financial and economic crises, noting that remedies, in this respect, required action by the concerned governments, such as diversification of resources of income, creating new jobs and boosting the financial sector.

For her part, Lagarde praised role of the governments of the GCC countries for realizing financial and economic stability for their peoples.
The GCC states play a key role for maintaining the international financial and economic stability, she noted, noting the IMF desire to pursue cooperation with these oil-producing countries for serving this purpose.
The participating officials, ahead of start of the meeting, held closed-door talks with Lagarde.

Agenda of the meeting deals with issues regarding GCC economic cooperation, governance of finance and monetary institutions in the region, results of the 55th meeting for governors of GCC central banks held in Kuwait, the GCC unified tax system, the Gulf unified trademark laws, in addition to other topics.


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