The risk reward scenarios in delaying transformation of GCC economies - The National

The risk reward scenarios in delaying transformation of GCC economies - The National:

"As visions go, transforming leading GCC economies such as Saudi Arabia's is exciting. Transformation promises more diversification and security. Instead of having all the eggs in the fossil fuel basket, different sectors of the economy are set for development. This frees GCC countries from excessive risks linked to a monolithic economy. The last two-and-a-half years have shown what happens when crude oil prices crumble. The foundations of oil-producing countries have been shaken to the core. All the financial and economic pain is sending a signal. It appears to be a foregone conclusion that diversification is urgent. So much for the necessity for economic modernisation. But the devil is in the details, as the saying goes. The recent slowdown of the transformation process sent a warning message to investors. Still, the reaction has been relatively mild, possibly due to the stabilisation of the oil price. The markets may not be alarmed, but economic risk-reward scenarios are back under the microscope. GCC countries would struggle if they took another hit like the last two-and-a-half years of low oil prices."



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