Gains forecast for GCC under single market system
A report into financial growth has claimed that if the GCC were to become one single market instead of six separate ones today, it would be the ninth largest economy in the world - similar in size to Canada and Russia and not far from India. And if it is able to keep growing at an annual average of 3.2 per cent for the next 15 years, it could become the sixth largest economy in the world by 2030, hovering just below Japan, according to the survey by financial firm Ernst & Young. Gerard Gallagher, MENA Advisory Leader, EY, said: “GCC governments are facing a decisive moment. With oil price falling, they have to accelerate the creation of growth drivers that do not rely on oil revenues. They are now exploring options and taking decisions such as opening up to foreign investors, ending subsidies, introducing taxation, optimising costs and cutting jobs in the public sector. There are signs that serious change has begun. However, these reforms could be less disruptive and more effective as part of a wider push towards rekindling and modernising the drive towards a single GCC market.” The report said that under a single market, removing obstacles to trade and investment would boost the GCC GDP by 3.4 per cent or $36 billion, with 96 per cent of the gain coming from a reduction in bureaucracy. The benefits would be spread across all six economies, with the strongest gains in the UAE, Saudi Arabia, Bahrain and Oman, with increases in GDP between 3.5 per cent and 4.1 per cent in the four countries, the report said.