25 Apr 2016
IMF: Middle East economies to face up to $150bn oil revenue falls in 2016
In its latest review, IMF focuses on Saudi Arabia and the Gulf region, with its director of the Middle East and Central Asia Department, Masood Ahmed noting the following:
2016 is year number two in a multi-year adjustment process to reach balanced budgets
Probably another four to five years of action will be needed both on spending and on revenues before reaching a comfortable fiscal situation for many countries
Gulf’s response to the low oil prices as quite determined
If jobs continue to be created at the same rate as in the last few years, you will end up with 3 million (additional) unemployed by the end of this five-year period
The model that we need to go to is one where not all the nationals look for work in the public sector and the state is not just a primary provider of jobs
Meanwhile, WSJ reported headlines from the IMF, “The International Monetary Fund estimates the Middle East’s oil-dependent economies have missed out on $390 billion in oil revenues last year alone and face up to $150 billion in income losses this year as a result of cheap oil prices.”
“The drop in revenues stemming from the export of oil is the direct result of the plunge in crude prices from around $115 a barrel in the middle of 2014 to below $30 at the start of the year and now above $40. The IMF had previously calculated that the declining energy prices would erase around $360 billion in oil receipts.”
2016 is year number two in a multi-year adjustment process to reach balanced budgets
Probably another four to five years of action will be needed both on spending and on revenues before reaching a comfortable fiscal situation for many countries
Gulf’s response to the low oil prices as quite determined
If jobs continue to be created at the same rate as in the last few years, you will end up with 3 million (additional) unemployed by the end of this five-year period
The model that we need to go to is one where not all the nationals look for work in the public sector and the state is not just a primary provider of jobs
Meanwhile, WSJ reported headlines from the IMF, “The International Monetary Fund estimates the Middle East’s oil-dependent economies have missed out on $390 billion in oil revenues last year alone and face up to $150 billion in income losses this year as a result of cheap oil prices.”
“The drop in revenues stemming from the export of oil is the direct result of the plunge in crude prices from around $115 a barrel in the middle of 2014 to below $30 at the start of the year and now above $40. The IMF had previously calculated that the declining energy prices would erase around $360 billion in oil receipts.”