GCC economies set for growth through 2026
Published: 05:12 PM,Dec 21,2024 | EDITED : 10:12 PM,Dec 21,2024
GCC economies set for growth through 2026
MUSCAT: The Gulf Cooperation Council (GCC) economies are set to experience steady growth over the coming years, with real GDP projected to expand by 3.7 per cent in 2024, 4.5 per cent in 2025, and stabilise at 3.5 per cent in 2026, according to forecasts by the GCC Statistical Centre.
This positive outlook is attributed to rising oil production across the region, supported by OPEC+ gradually easing production quotas since the second half of 2024. The completion of key gas field developments, coupled with robust recoveries in transport, tourism and infrastructure sectors, underpins this growth. Expansionary fiscal policies implemented by GCC governments further bolster these projections.
The non-oil sector is also expected to play a critical role, with growth forecasted at 4.5 per cent in 2024, maintaining momentum at 3.3 per cent and 4.1 per cent in 2025 and 2026, respectively. Accelerated private sector activity is driving this expansion, particularly in tourism, transport, storage and retail. Major infrastructure projects across the GCC are acting as catalysts, stimulating private sector growth and supporting economic diversification efforts.
The report highlights that the continued implementation of economic diversification strategies will significantly enhance key sectors such as renewable energy, technology and innovation, and manufacturing, solidifying the GCC’s position as a hub for emerging industries.
In 2023, the GCC’s real GDP reached $1.691 trillion, reflecting a modest growth of 0.5 per cent compared to the previous year. The non-oil sector’s contribution grew by 3.3 per cent during the same period. However, average per capita GDP at current prices declined by 5 per cent, dropping to $36,700 in 2023 from $38,600 in 2022.
Globally, the GCC’s nominal GDP contributed 2 per cent of the world’s $105.4 trillion economy in 2023 and accounted for 60.5 per cent of the Arab region’s $3.5 trillion GDP.
Inflation across the GCC is expected to remain stable at 2.4 per cent in 2024, 2.6 per cent in 2025, and 2.1 per cent in 2026. However, potential risks to inflationary pressures could arise from higher consumer prices, increased costs of imported raw materials and rising household consumption due to improved employment rates, higher wages and greater household incomes. Additionally, expansionary public spending across the region and global monetary policies — particularly in the United States, European Union, United Kingdom and Japan, aimed at curbing inflation through high interest rates —are expected to influence inflation trends.
The GCC remains on track to further strengthen its economic resilience, leveraging its strategic policies to achieve long-term sustainable growth across diverse sectors.
This positive outlook is attributed to rising oil production across the region, supported by OPEC+ gradually easing production quotas since the second half of 2024. The completion of key gas field developments, coupled with robust recoveries in transport, tourism and infrastructure sectors, underpins this growth. Expansionary fiscal policies implemented by GCC governments further bolster these projections.
The non-oil sector is also expected to play a critical role, with growth forecasted at 4.5 per cent in 2024, maintaining momentum at 3.3 per cent and 4.1 per cent in 2025 and 2026, respectively. Accelerated private sector activity is driving this expansion, particularly in tourism, transport, storage and retail. Major infrastructure projects across the GCC are acting as catalysts, stimulating private sector growth and supporting economic diversification efforts.
The report highlights that the continued implementation of economic diversification strategies will significantly enhance key sectors such as renewable energy, technology and innovation, and manufacturing, solidifying the GCC’s position as a hub for emerging industries.
In 2023, the GCC’s real GDP reached $1.691 trillion, reflecting a modest growth of 0.5 per cent compared to the previous year. The non-oil sector’s contribution grew by 3.3 per cent during the same period. However, average per capita GDP at current prices declined by 5 per cent, dropping to $36,700 in 2023 from $38,600 in 2022.
Globally, the GCC’s nominal GDP contributed 2 per cent of the world’s $105.4 trillion economy in 2023 and accounted for 60.5 per cent of the Arab region’s $3.5 trillion GDP.
Inflation across the GCC is expected to remain stable at 2.4 per cent in 2024, 2.6 per cent in 2025, and 2.1 per cent in 2026. However, potential risks to inflationary pressures could arise from higher consumer prices, increased costs of imported raw materials and rising household consumption due to improved employment rates, higher wages and greater household incomes. Additionally, expansionary public spending across the region and global monetary policies — particularly in the United States, European Union, United Kingdom and Japan, aimed at curbing inflation through high interest rates —are expected to influence inflation trends.
The GCC remains on track to further strengthen its economic resilience, leveraging its strategic policies to achieve long-term sustainable growth across diverse sectors.