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A study has shown that the increase in oil revenues greatly improves the budget and trade balance of the Arab Gulf countries.
The average reference crude oil price was $ 71.60 per barrel since the beginning of the year The Gulf countries are moving towards more oil this year after the world's major producers have set themselves up. Last month to increase crude oil production, offsetting in particular the expected loss of Iranian production, which faces US sanctions.
The increase in this output will benefit public finances
In a quarterly survey conducted by Reuters on the opinions of economists from 24 specialists, the average forecast for the Saudi government's budget deficit this year was 4, 8% of GDP, instead of the 7.8% forecast in the previous survey. While the 4.8% deficit remains unsustainable for Saudi Arabia in the long run, it is the lowest since 2014. The new survey predicts that next year's budget deficit will reach 4.5% of GDP. GDP, compared to 6.7% in previous projections.
The financial perspectives of the other five members of the Gulf Cooperation Council (GCC) have also improved. The UAE is currently expected to record a fiscal surplus of 0.1 percent of GDP this year instead of a deficit of 2.9 percent. Forecasts for 2019 showed a surplus of 1.4% instead of a deficit of 2.2%. Likewise, current account surpluses are expected to boost the GCC's strongest economies – Saudi Arabia, the United Arab Emirates and Kuwait.
Saudi Arabia is expected to record a current account surplus of 8.7 percent of GDP this year from 3.3 percent in the previous poll, although this figure remains below double digits before the fall oil prices.
However, the new survey is not expected to have a significant impact on promoting economic growth in the Gulf region.
"Feasibility" Higher oil revenues than budgeted will not result in increased government spending, but will help reduce budget deficit. "
New survey pushes average growth forecast of GDP for Saudi Arabia to 1.5% this year.And 2.5% of 2.4% for next year.The growth forecasts of Saudi Arabia for the sector non-oil private were only 1.1% this year
The UAE growth forecast has not changed from the previous survey, rising to 2.6% this year and 3.2 per cent next year, forecasting a large budget deficit and current account balance for Bahrain and Oman, indicating that financial markets may remain concerned about the long-term prospects of both countries, unless two governments continue their reforms.
Bahrain should record a budget deficit of 8.8% Percent of GDP this year instead of 9.8% The current account balance of Bahrain is expected to remain in deficit until 2020.
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