Page 46 - Aamir Rehman Gulf Capital and Islamic Finance The Rise of the New Global Players

CHAPTER 1 Floating on Wealth 31

economic growth in the GCC has not been “all about oil”—oil has dri-
ven wealth creation, but this wealth has created booms in a wide range
of economic sectors. 23
Were the Gulf to maintain the growth rate it experienced
between 2002 and 2006, its economy would double every 11 years. By
contrast, the core OECD markets would need more than 30 years to
double in size were they to maintain their rate of expansion for the
period. In reality, of course, the healthy growth period of the early to
mid-2000s has been followed by a deep recession that has affected
economies worldwide—including those of the Gulf.

. . . “COOLING” IN A GLOBAL RECESSION
The cooling effect of the global recession on the Gulf economies has
been substantial. Figure 1.3, based on analysis and projections made
by the Economist Intelligence Unit in 2009, illustrates expected real
growth rates for each GCC economy and a number of other economic
clusters for comparison.
While world economic growth generally slowed in 2008 relative
to 2007, the major energy exporters of the Gulf—including the UAE,

FIGURE 1.3
GCC Economic Growth Has Cooled, but Remains Stronger than That
of Other Regions

12%
21.5%
10%
8%
Real Economic Growth (Actual and Forecasts), 2007–2010 6% 2007

2008 (est.)
4%
2009 (proj.)
2010 (proj.)
2%
0%
Saudi
–2% Qatar Bahrain UAE Oman Kuwait Arabia World EU OECD
–4%
“EU” includes 27 EU economies.
Source: Economist Intelligence Unit, January 2009.