(MENAFN - The Peninsula) With their budget surplus this year forecasted to be 10.4 percent of their gross domestic product (GDP) this year according to the International Monetary Fund's estimates, the GCC economies have shown their ability to overcome serious crisis with least negative impact, said the Deputy Premier and Minister of Energy and Industry, H E Abdullah bin Hamad Al Attiyah, yesterday.
Addressing the Federation of GCC Chambers'(FGCCC) Forum, Attiyah said the GCC had taken positive steps in the years when oil prices were high since the beginning of the last decade which contributed in minimising the impact of the global financial crisis on the GCC countries.
He added that all indicators at the beginning of this year show an improvement in the economy of GCC in general on the backdrop of the expected stability in oil prices of around 80 per barrel.
This, said Attiyah, will give a strong momentum to the region to implement its key development programs and achieve further budget surplus which would lead to more flexibility in Gulf economies to carry on economic and legislative reforms and build an attractive investment environment for foreign capital.
In his address Attiyah also highlighted the impact of the global financial crisis on the Gulf which was accompanied by the collapse of oil prices which picked at 147 per barrel in 2008 and also the drop in the prices of gas and industrial products.
"The impact of the crisis in our economies in general was relatively moderate compared to other countries," he said.
The GCC GDP growth at 10 percent in 2008 was the world's highest rate, he said. But this rate collapsed in 2009 to as low as 2.1 percent with the IMF predicting a rise in 2010 to 3.5 percent and probably to more than five percent in following years if oil prices remain at the current level.
Among the reforms that GCC countries need to undertake, Attiyah cited the increase in the level of transparency and quality of economic statistics in view of further integration between GCC countries on the one hand and integration with world economies on the other.
He stressed the need to promote and create an attractive and favorable investment environment and increase the volume of bilateral trade between the GCC states as well as remove all obstacles and constraints that are facing investment.
He also called for raising the size of bilateral trade between the GCC states from the current 20 percent, which is low and should be in higher rate than that, he said.
He added that the volume of bilateral trade between the countries of the Arab world was 10 to 11 percent, noting that the GCC private sector has played an active role in the region's economies citing the emergence of giant Gulf companies.
By Nasser Al Harthy