* Oxford Economics upbeat on Qatar as the country prepares to stage the region's first ever FIFA World Cup in 2022 and opens the doors to global investment and workforce
Qatar’s real GDP has been projected to grow 2.5% this year and 3.7% in 2022, according to Oxford Economics.
In a report on Thursday, Oxford Economics said: “Our projections vary across economies given divergent growth strategies and different policy space. We are upbeat on the UAE and Qatar as they benefit from hosting international events (Expo and World Cup) and open the doors to global investment and workforce, while the Saudi National Investment Strategy supports its growth prospects despite scaling back of spending. Kuwait and Oman will find it harder to boost recovery against the backdrop of workforce nationalisation policies and limited budget headroom.”
Oxford Economics anticipate a “strong recovery in economic output” across the GCC in 2022, with GDP growing at 5.2%, almost twice the pace this year.
“It is challenging to forecast the impact of Omicron, given limited knowledge about the variant, but it is clear that downside risks stemming from the pandemic will linger for the foreseeable future.”
Oil sector performance, it said will lead the rebound next year, rising by almost 8%, following a modest 0.6% expansion in the last 12 months.
The Opec+ group has stuck to its plan to steadily increase production quotas and, despite adopting a flexible approach to policy, it is unlikely to adjust this unless the Omicron variant dents demand to the extent that leads to a marked decline in oil prices.
“We now see Brent averaging $72.5/ barrel in 2022, slightly above this year, but down to $68/b by end-2022,” Oxford Economics noted.
Notwithstanding higher expected investment in the oil sector and planned capacity increases in several countries, including Saudi Arabia and the UAE, energy transition will remain firmly on the regional agenda.
GCC’s non-oil sector recovery will continue in 2022, albeit at a slower pace of 3.3% (versus 3.8% seen this year), lagging the energy sector for the first time since 2018.
Latest PMI surveys, the most-timely indicators of the health of the nonoil sector, point to sustained growth momentum, though firms’ optimism has been hit by the emergence of Omicron.
Pending a verdict on vaccine efficacy against the new variant, low infection rates, high vaccine uptake and booster shot campaigns will likely contain fresh outbreaks in the region and help countries avoid lockdowns.
Less disruptive Covid measures have allowed mobility levels and domestic activity to return close to normal, helping to fuel the recovery, even though the relationship between GDP growth and changes in mobility has weakened over time, Oxford Economics said.
In a report on Thursday, Oxford Economics said: “Our projections vary across economies given divergent growth strategies and different policy space. We are upbeat on the UAE and Qatar as they benefit from hosting international events (Expo and World Cup) and open the doors to global investment and workforce, while the Saudi National Investment Strategy supports its growth prospects despite scaling back of spending. Kuwait and Oman will find it harder to boost recovery against the backdrop of workforce nationalisation policies and limited budget headroom.”
Oxford Economics anticipate a “strong recovery in economic output” across the GCC in 2022, with GDP growing at 5.2%, almost twice the pace this year.
“It is challenging to forecast the impact of Omicron, given limited knowledge about the variant, but it is clear that downside risks stemming from the pandemic will linger for the foreseeable future.”
Oil sector performance, it said will lead the rebound next year, rising by almost 8%, following a modest 0.6% expansion in the last 12 months.
The Opec+ group has stuck to its plan to steadily increase production quotas and, despite adopting a flexible approach to policy, it is unlikely to adjust this unless the Omicron variant dents demand to the extent that leads to a marked decline in oil prices.
“We now see Brent averaging $72.5/ barrel in 2022, slightly above this year, but down to $68/b by end-2022,” Oxford Economics noted.
Notwithstanding higher expected investment in the oil sector and planned capacity increases in several countries, including Saudi Arabia and the UAE, energy transition will remain firmly on the regional agenda.
GCC’s non-oil sector recovery will continue in 2022, albeit at a slower pace of 3.3% (versus 3.8% seen this year), lagging the energy sector for the first time since 2018.
Latest PMI surveys, the most-timely indicators of the health of the nonoil sector, point to sustained growth momentum, though firms’ optimism has been hit by the emergence of Omicron.
Pending a verdict on vaccine efficacy against the new variant, low infection rates, high vaccine uptake and booster shot campaigns will likely contain fresh outbreaks in the region and help countries avoid lockdowns.
Less disruptive Covid measures have allowed mobility levels and domestic activity to return close to normal, helping to fuel the recovery, even though the relationship between GDP growth and changes in mobility has weakened over time, Oxford Economics said.