Gulf governments enjoy fiscal flexibility; must spend wisely over coming years

Al-Monitor Pro Members

Dr. Robert Mogielnicki

Senior Resident Scholar, Arab Gulf States Institute in Washington 

Jan. 27, 2023

The public sector revenues of governments in Gulf Cooperation Council (GCC) member states remain closely tied to proceeds from oil and gas exports. Elevated energy prices in 2022 permitted GCC states to begin 2023 in relatively strong fiscal positions. Short-term energy outlooks forecast lower oil and gas prices, but past fiscal reform progress will help reduce the negative impact on budgets. Regional governments must exercise smart spending to ensure momentum continues for their respective economic diversification efforts.