Business | Economy
Gulf states urged to restructure economies
Leading Arab financerson Friurged Gulf governments, flush with cash from the oil boom, to embark on wholesale political and economic reforms they said were crucial to sustain their economies in the long-term.
- Reuters
- Published: 00:05 May 3, 2008
Beirut: Leading Arab financerson Friurged Gulf governments, flush with cash from the oil boom, to embark on wholesale political and economic reforms they said were crucial to sustain their economies in the long-term.
Speaking at the Arab Economic Forum in the Lebanese capital, the fin-ancers said efforts by Gulf states to restructure and liberalise their oil dependent economies have lacked vigour to expand a private non-oil sector, solve high unemployment and reduce dependence on the state.
The forum is an annual meeting of policy-makers, financiers and businessmen in Beirut organised by Al Iktissad Wal Aamal magazine.
Ali Zumai, head of a Kuwaiti investment group and a former finance minister, said Gulf budgets contain huge spending on salaries and handouts "without any return on development".
Unemployment
Record oil prices have fuelled fast growth rates in the Gulf but unemployment mostly remains high. Saudi Arabia official data puts unemployment at 12 per cent, half independent estimates.
A report by the Arab Petroleum Investments Corporation (Apicorp) forecast economic growth in the Gulf to average six per cent over from 2008 to 2012, with unemployment at seven per cent. The report did not give comparative figures.
Ali Aissaoui, senior manager at Apicorp, said the oil sector accounts for 30-40 per cent of the Gulf's gross domestic product but only three per cent of the employment directly due to increased reliance on technology.
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