Page 46 - Aamir Rehman - Dubai & Co Global Strategies for Doing Business in the Gulf States-McGraw-Hill (2007)

30 Dubai & Co.

THE GULF: TREMENDOUS WEALTH WITH
SMALL INDIGENOUS POPULATIONS
The economies of the GCC countries represent the most attractive
cluster of markets in the Middle East. These markets are character-
ized by oil wealth, small indigenous populations, relatively stable
monarchies, desert climates, and modest origins. As we discuss in
length throughout this book, the GCC represents a set of dynamic,
opportunity-rich economies with much to offer multinational com-
panies. A combination of sustained prosperity, attractive demo-
graphic shifts, and regulatory reform make the GCC an increasingly
appealing place to do business.
When viewed as a collective whole, the economies of the GCC
form an impressive collective entity. Consider the following:

● All together, the GCC economies would be the seventh-
largest in the developing world: twice the size of the
economies of Turkey, South Africa, or Argentina. 11
● In the five-year period ending in 2006, the GCC’s GDP per
capita rose 80 percent. 12
● The region’s combined central government surplus, driven
by gushing oil revenues, stands at over 20 percent of GDP. 13

In addition to their economic similarities, the GCC states share
common political environments. All are monarchies, and although
some do have consultative (often elected) bodies, ultimate power in
each rests firmly with the sovereign. All trace their roots to simple
desert tribes and retain some elements of traditional tribal culture.
In fact, the ruling families of multiple GCC states trace their origins
to the same part of the Arabian Peninsula. Most of the GCC states
signed treaties with the UK during the colonial era that included the
provision that the states and their rulers would be protected in
exchange for exclusive ties with Britain. All are members of the
WTO, and—like new WTO members everywhere—struggle with a
delicate balance of protecting local businesses while opening up to
the global economy.
While the Gulf states share core attributes that make them a
common cluster, each of the six countries is unique. Table 1.2 pro-
vides, at a glance, a comparison of the six states along a few key
dimensions.