Given the intense debates on GCC economies’ further diversification, it is essential to underscore the significance of further support for the process.
This hinges on two factors: the diversification of local economic policies within each GCC country, and the completion of the various components of Gulf-wide cooperation, particularly the launch of a common market.
The divergence in economic policies across GCC countries has given rise to notable development experiences. These have, in turn, fostered diversification from a reliance on oil proceeds, and contributed to heightened growth rate. This is in stark contrast to countries that have shown slower economic decision-making processes or stuck to entrenched traditional economic policies and struggled to achieve similar diversity.
It is imperative to carefully examine and learn from these diverse development experiences. This can be achieved through the exchange of knowledge, with a focus on avoiding duplication and identifying fresh investment opportunities. Such efforts will undoubtedly foster greater synergy among Gulf economies.
Acknowledging the recent inclination of certain GCC countries to draw lessons from these experiences, it is evident that further coordination is imperative - bilaterally and collectively - through the GCC General Secretariat. And which needs to redirect its focus towards fostering economic cooperation.
The advancement of Gulf-wide economic diversification can be propelled to a more advanced stage through faster completion of pending cooperative endeavours, notably the customs union and the common market. If brought to fruition, these would transform the GCC markets into a unified, expansive single market, which would offer boundless investment opportunities and facilitate crucial development projects across sectors.
This potential is rooted in two primary factors: establishment of the single market itself and the unimpeded flow of goods via free movement, import, and export among the six countries, effectively eliminating current hindrances and complex procedural bottlenecks.
Several projects with potential to significantly bolster economic diversification require substantial investments, which some GCC countries may struggle to attract individually. However, with a common market, which facilitates the free movement of goods, services, and investments, this can effectively be surmounted.
Consequently, Gulf investments from both the public and private sectors can help in the realisation of these projects. Several noteworthy projects, some of which have already been executed, exemplify the remarkable benefits attainable through collaboration.
GCC has done it before
The establishment of aluminium plants and the Gulf Petrochemical Industries Company in Bahrain serve as shining examples. These yielded tangible results and creating advantages for all participating countries. They also contributed to diversifying the economies while simultaneously generating job opportunities for Gulf citizens.
By merging joint local and Gulf approaches, the GCC economies are poised to make a substantial leap, which will propel them into the ranks of the world’s Top 10. Thus bestowing upon them significant economic and geopolitical influence from their increasing participation in influential alliances, such as the G20 and BRICS.
These will further enhance their global significance, allowing them to leverage their newfound stature for even greater gains. It is essential to acknowledge that despite such favourable conditions - advanced infrastructure, substantial capital, and a skilled local workforce - the path forward is not without challenges.
Multiple difficulties and obstacles exist, but they can be surmounted when approached from the perspective of shared interests and evolving international circumstances. Such a transformation would not only bolster economic and financial stability but address issues like job creation and enhanced living standards. The foundation lies in enhanced Gulf cooperation, and is deserving of greater attention and dedicated efforts to realise its potential.