After the drop in oil prices and the resultant rearrangement of economic priorities and expenditures, the interest in granting the Gulf’s private sector a greater role in the development process has increased significantly. And rightly so as private players enjoy sizeable — and growing — financial capacities and supported by state-of-the-art infrastructure to develop their operations.
It is a matter of fact that the private sector’s roles in the six Gulf States are extremely uneven socially and economically. Therefore, the states need to exchange experiences and expertise so as to increase the private sector’s developmental effectiveness.
In the UAE, for example, some businessmen launched an initiative with promising prospects. They founded the “Al Watan Fund” with an aim to promote the Emirati private sector’s social responsibility and boost its contribution to development.
This initiative seems to be the beginning for coordinated action within the UAE’s private sector, where investors’ financial capacities may show variances. However, the establishment of the fund — through which investment activities can be accumulated and coordinated — could generate sizeable capacities needed to implement investment projects and provide cutting-edge services that benefit society, including services like education and establishing hospitals specialised in endemic diseases.
Furthermore, Saudi Arabia’s private sector has extensive experience in the development of industrial projects and its products have wide acceptance not only in the Middle East but in many other countries as well.
The Kuwaiti private sector has also built up over the past two decades a number of specialised health facilitates to treat certain diseases and that has saved thousands of lives. Meanwhile the private sector in Oman, Bahrain and Qatar are seeking to develop their own capabilities so as to enhance their activities in some export-based sectors as the domestic markets are relatively small.
The GCC’s private sector shares some common denominators — the convergence of vision among decision-makers, the great support being provided to investors, as well as the existence of common Gulf institutions that work to unifying legislations that would allow greater cooperation and link their interests in the context of the Gulf Common Market.
Consequently, that will constitute a supportive platform if things run the course as set by these institutions. Back again to the Emirati initiative as represented by the Al Watan Fund. This is expected to play a great developmental role and its basic idea was derived from late Shaikh Zayed Bin Sultan Al Nahyan’s initiative when he called on businessmen in a TV interview to contribute to the development of their country and provide the community with necessary support through implementing charitable and development projects.
The Al Watan Fund can also be generalised to include the activities of the private sector in the other GCC markets, whereby businessmen in those countries can set up similar funds that would further contribute to the economic and social development
What matters in future is coordination between these funds as Gulf economies are in need of various projects that entail sizeable financial capacities and exceed the capabilities of a single country. Therefore, implementing such projects requires cooperation between the various Gulf funds.
In addition, Gulf countries should establish health and educational facilitates and share research facilities that serve all of them instead of establishing smaller centres with limited capacities.
In such a case, the advantages will cover the whole economic structure in the Gulf states and create further stability and economic diversity.
Dr Mohammad Al Asoomi is a UAE economic expert and specialist in economic and social development in the UAE and the GCC countries.
