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Mazaya Monthly Real Estate Report -
Week 2 - October 2015
A report recently issued by the Arab
MonetaryFund (AMF) predicts8.2percent
growth for Arab economies collectively
in 2015, and 3.5 percent growth in 2016.
The report further shows world oil
markets are still affected by the fragile
global economic recovery, and pressures
of supply. The report points out that Arab
and, particularly, Gulf economies are
still heavily reliant on the fortunes of the
hydrocarbon sector, and that a downturn
in the price of oil will inevitably be felt in
Arab societies. Oil revenues constitute
68 percent of the Arab countries’ total
revenues. The report predicts that
Arab oil exporting nations will see GDP
decrease by as much as five percent in
coming years if the oil price remains low.
These are uncertain times, economically,
and it is vital that Gulf real estate
developers act cautiously and cleverly
to
negotiate
them
successfully.
Should this be the case, this report
believes Gulf governments will
naturally become more cautious
in their approach to stimulating
economic growth, and that areas
in which they had previously been
happy to invest significantly will
become markedly less attractive as a
result of the risk profiles they present.
The prognostications of the World
Monetary Fund, in this light, make for
particularly grim reading – predicting,
as they do, contractions in the global
economy over the coming two years, at
least, and a serious drop inworld trade.