The GCC economies have set a stellar example for development and growth of multiple sectors through an emphasis on advanced infrastructure. In fact, the infrastructure has grown and expanded since the oil boom.
Yet, the GCC’s gains on internal experiences have not been mirrored in the shared infrastructure, which still lags below local options. This then requires GCC members to hasten the creation of a unified Gulf infrastructure framework and to incorporate this within the existing local infrastructure.
The unified Gulf power grid – a singular accomplishment - makes the case for further GCC integration. Power outages were highly prevalent in the GCC states in the 1970s and even into the 1990s, especially during peak summer. This resulted in significant losses. But since the common Gulf power network was turned on, none of the GCC members have experienced outages, even while demand kept hitting record highs.
This contributed to the stability of operations for various companies and GCC businesses as a whole, while also providing important income for the power surplus countries through exporting electricity. Therefore, the surplus has benefited every GCC nation without exception, which constituted a transformation for the energy sector in the GCC.
Administrative shortfalls
Outside of the power sector, things did not proceed as intended, and the GCC members have not collaborated on a shared infrastructure, despite expectations that they would build on this substantial experience in electricity. Even though various decisions were passed by the Supreme Council's annual meetings, nothing in this regard has improved for 20 years. These decisions include a plan to build an integrated rail network for the Gulf train as well as a water link between Gulf states, which is vital given the geopolitical and climatic conditions in the Arab Gulf area.
Frankly, there are no excuses nor impediments to the execution of several common Gulf projects, including a gas network. Both the funding and the technical elements are available. Given that these initiatives are economically feasible and will have a significant impact on the economies, the problem likely lies at the administrative level.
Actually, the Gulf cooperation needs calibrated administrative decisions, as evidenced by the no-improvement made so far to the Gulf rail project, which was scheduled to be completed in 2017. While the internal networks of the UAE and Saudi Arabia are almost complete, those of some other countries are either still planning for special trains or have altered their courses several times. Some others haven't even made any actionable decisions.
Don’t miss out
As for the water connection project, which signifies water security for the GCC members, it is frozen at a time when most required. Additionally, no decision has been made about the gas network, which is becoming increasingly crucial for economies. (The exception is one being explored among three states to construct their own gas network.)
The latest round of price increases might present excellent opportunities to complete collaborative Gulf projects, which would represent another qualitative leap for the economies. This is because the Gulf development process is getting a fresh burst of speed with the recovery of oil prices. However, where administrative decision-making still has flaws, this necessitates swift action.
The GCC General Secretariat is expected to make a significant contribution to promote the implementation of these projects, removing administrative blocks that have long delayed initiatives, and initiating new ones that are just as critical to the future development of the Gulf’s economic security and social stability.
Mohammed Al Asoomi
The writer is a specialist in energy and Gulf economic affairs
