The Gulf Cooperation Council (GCC) countries remain pivotal to any business strategy in the Middle East and its growing importance in the region's business and trade activities cannot be ignored, according to Edmund O'Sullivan, Chairman, Middle East Economic Digest. Speaking during a networking session in Dubai recently ahead of the second edition of the World Ports & Trade Summit (WPTS) 2012 that will run on April 2-4 in Abu Dhabi, he said while recession continues to pose concerns, the GCC countries are comparatively well entrenched having accumulated almost $1.5 trillion in surpluses since 2000. Besides, debt is generally low in these countries. "GCC states are forecasted by the IMF to generate at least $1 trillion worth of surpluses 2011-16. This is more than enough to finance all foreseeable infrastructure requirements and support continuing external investments," O'Sullivan said. Looking ahead at what's in store for these economies for the rest of the year, O'Sullivan pointed out that the GCC project market is set to rebound in 2012. "Saudi Arabia will continue to the principal focus for business. UAE will see further signs of Dubai's recovery and there will be a rebound in Abu Dhabi's projects sector driven mainly by plans for a new terminal, railway line and Emirates Aluminum (EMAL) phase two project." "Qatar transport projects will start moving, Kuwait project program is ready to go, and in Oman the Khazzan field is likely to go ahead in 2012"he added. "Provided a large oil price crash is avoided, 2012 should see general economic growth in the GCC and strong growth in the projects sector." On the growth plans of the world's marine and trade industry, O'Sullivan pointed out that being centrally located between the European Union countries and the growing economy of China, GCC states are in an extremely advantageous situation. "They have a hub status and are important partners for players on both sides of the globe," he said. However, while the GCC states are often viewed together on comparable levels, the fact is they are diverse and increasingly becoming diverse, O'Sullivan noted, underlining the need for the shipping and trade industry to come up with tailor-made business strategies for each country. He pointed out that Saudi Arabia has more than 20 percent of the world's oil, while Qatar has about 14 percent of the world's gas. Morocco and Jordan have effectively no hydrocarbon reserves. "To succeed in the region, companies need to be nuanced, flexible, pragmatic and consistent," he added. O'Sullivan identified oil and gas as one of the main factors driving the GCC economies to 2020. "Oil price is expected to average $100 plus a barrel. World oil demand is growing by about 1 percent a year. Demand for gas will be buoyant," he said. Economic diversification and population growth will also be key factors, he added. The WPTS 2012 summit will be held under the patronage of General Sheikh Mohammed Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces. Over 4,000 delegates, representing ports authorities, shipping lines, cargo operators, logistics companies, technology solutions providers, investors and financiers are expected to attend the summit to discuss the state of the industry, emerging markets and the way forward.
