Gulf Cooperation Council: Economic Prospects and Policy Challenges for the GCC Countries; IMF Country Report No. 23/413; December 5, 2023

IMF Staff Country Reports, December 14, 2023

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Gulf Cooperation Council: Economic Prospects and Policy Challenges for the GCC Countries; IMF Country Report No. 23/413; December 5, 2023

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Bibliographic details

• Published: December 14, 2023
• Series: IMF Staff Country Reports
• DOI: https://doi.org/10.5089/9798400263279.002

Summary findings

• The paper discusses economic prospects and policy priorities for the GCC countries.
• A comprehensive package of policies should be implemented to respond to near-term shocks and uncertainty and to firmly address medium- and long-term challenges.
• Near-term fiscal policy should remain prudent, avoiding procyclical spending and using the windfall from higher oil prices to rebuild buffers.
• Targeted and temporary fiscal measures could be undertaken to respond to shocks, if they materialize.
• In the medium term, GCC countries should continue pursuing fiscal consolidation consistent with ensuring intergenerational equity and sustainability, supported by a credible rules-based medium-term fiscal framework.
• Continued financial sector reforms are needed to support growth and stability.
• Structural policies should continue focusing on diversifying the economies away from hydrocarbon.
• Reform efforts aimed at further enhancing product market regulations, labor markets, and governance will spur growth.
• Efficient investments in digital and green initiatives will accelerate transformation and support energy transition.
• Industrial policy should be carefully calibrated and not substitute for structural reforms while minimizing related inefficiencies.

Near-term policy recommendations

• Maintain prudent fiscal policy; avoid procyclical spending.
• Use the windfall from higher oil prices to rebuild buffers.
• Implement targeted and temporary fiscal measures only if shocks materialize.

Medium- and long-term policy priorities

• Pursue fiscal consolidation consistent with intergenerational equity and sustainability.
• Adopt a credible rules-based medium-term fiscal framework.
• Continue financial sector reforms to support growth and stability.
• Advance structural reforms to diversify away from hydrocarbons.
• Enhance product market regulations, labor market frameworks, and governance.
• Invest efficiently in digital and green initiatives to accelerate transformation and support energy transition.
• Calibrate industrial policy to complement, not substitute for, structural reforms and to minimize inefficiencies.

Thematic areas covered

• Climate finance
• Environment
• Financial statements
• Inflation
• Monetary policy
• Oil prices
• Political economy
• Prices
• Public debt
• Public financial management (PFM)

Keywords

• centrality indices
• Climate finance
• financial market
• Financial statements
• GCC Countries
• GCC country
• GCC net
• GCC's acceleration
• Global
• Gulf Cooperation Council
• Inflation
• Middle East
• Oil prices
• OPEC
• policies in the GCC

Content in this bundle

• Economic Prospects and Policy Priorities for the GCC Countries
  • Economic Prospects and Policy Priorities for the GCC Countries (Markdown version)
  • Economic Prospects and Policy Priorities for the GCC Countries (PDF)