On the face of it, the economies of the oil-rich Gulf and of fast-growing Asia are a perfect match. Yet they face a long slog to dispel the suspicion that theirs is no more than a marriage of convenience.
Barriers that have kept investment strikingly modest, the scant need for capital and a yawning divide of culture and language will have to be overcome if the two regions want to enrich what is now a fairly basic relationship: the Gulf ships oil and gas to Asia and recycles part of the petrodollars by importing manufactured goods, construction services and labor, most of it low-skilled.
"The fact that Asia and the Middle East, in particular the Gulf, account for a growing share of the global economy means that intra-regional investment will inevitably grow and mature. But it will likely be a slow process, evolving over decades rather years," said Ben Simpfendorfer, managing director of Silk Road Associates, a Hong Kong consultancy.
Economy will take time to recover, as the situation across the globe is very grim.
ReplyDelete