The economies of some Gulf states are more competitive than the many Western, notably European, economies. This has been made clear in the 2015-16 ‘Global Competitiveness Index’ brought out by the World Economic Forum.
Rankings of 14 and 17 have been assigned to Qatar and the UAE and ahead of those held by Belgium, Luxembourg, France, and Ireland. Saudi Arabia, ranked 25th, stays ahead of Iceland, Estonia, Czech and Span as well as South Korea and China.
Kuwait, at 34th spot, is ahead of Lithuania and Portugal after advancing by six notches and the best by a Gulf state within a year.
A major strength for Kuwait is that of a stable macroeconomic environment, through successive budgetary surpluses and to the extent that the current oil plunge is not threatening a fiscal imbalance.
Bahrain managed to advance by five positions to being 39th, which is ahead of the likes of Poland, Italy, Malta, South Africa and Turkey.
Oman, however, continued its trend of conceding positions and in a big way, this time falling by 16 notches to 62nd spot.
The survey relies on a comprehensive set of variables, which provide credence to the whole study. Specifically, the index ranks economies on the basis of their achievements in three broad categories — basic requirements, efficiency enhancers and innovation and sophistication factors.
The basic requirements are subdivided into institutions, infrastructure, macroeconomic stability, health and primary education. Efficiency enhancers comprises of higher education and training, goods and market efficiency, labour market efficiency, financial market sophistication, technological readiness and market size.
Qatar is staying ahead partly due to steady investments on broad infrastructure schemes while preparing to host the World Cup 2022. The authorities have committed themselves to investing billions of dollars on the big sporting event, to be held between November and December 2022.
For the UAE, preparation to host Expo 2020 in Dubai is a plus via spending on logistics.
In reality, the aviation industry is a net contributor to competitiveness of the UAE economy, as the country boasts four airlines including globally-renowned Emirates and Etihad. Low-cost carrier Flydubai received its 50th aircraft only last week, while Emirates is the largest operator of A380 planes.
Troubles concerning the labour market are undermining the competitiveness of Saudi economy. According to another study published by Swiss-based World Economic Forum, more than a quarter of Saudi youths happen to be jobless.
The actual figure could be less due to statistical difficulties. A good number of Saudi nationals generate revenues during the Haj season through using private vehicles to transport the pilgrims. This suggests that actual unemployment is less than suggested by some international studies.
The writer is a Member of Parliament in Bahrain.
