IMF: Reforms behind actual wealth of Gulf states

Georgieva reaffirms that Gulf region plays an important role in the global economy
IMF: Reforms behind actual wealth of Gulf states
Qatar Economic Forum in Doha

In a joint session with Saudi Finance Minister Mohammed Al-Jadaan and his counterpart Qatar’s Ali Al-Kuwari, at the Qatar Economic Forum in Doha, IMF Managing Director Kristalina Georgieva reiterated that the Gulf region plays an important role in the global economy on many fronts.

The first of these roles, which Georgieva referred to, “concerns energy security, as it intervened to calm markets after the Russian-Ukrainian war.” The second role stems from what we see from the distinctive determination of the Gulf countries to “carry out reforms, target future visions, and build stable platforms for the future, based mainly on the non-oil sector, which we expect to grow by 4.2 percent this year.”

She also praised the financial stability in the region’s markets, “where we have seen Gulf banks act responsibly in the liquidity crisis and adapt to shocks, which made them immune to the events in America and Europe.”

Read: Egypt pressed to implement reforms before IMF first review

For his part, the Saudi finance minister noted that Gulf states, in general, and the Kingdom in particular, are taking the path of reform and economic diversification “seriously”. He stressed that this path will not stop in 2030, the date of achieving the goals of the vision launched by Crown Prince Mohammed bin Salman, but rather that it was an ongoing mission.

Qatar’s finance minister noted that his country has Vision 2030, “but we also have an endless vision, which is to secure the quality of life, develop systems, and build a system that mitigates shocks when they occur.”

Debt ceiling


Separately, Georgieva said that the already troubled global economy can do without the crisis of needing to raise the US public debt ceiling, but expected it to be resolved at the last minute as usual.

“the debt crisis is unnecessary for the global economy, which is already highly uncertain,” from the debt ceiling crisis in the United States, she said. “History shows us that the United States is grappling with this supposed backwardness,” she said, referring to previous times when the United States has seen such a battle over the debt ceiling.

“At the last minute the matter is (usually) resolved and I’m confident we will see this scenario” this year as well, she said. ” (But) We must always keep in mind that the danger exists.”

Shift away from the dollar


Georgieva does not expect a rapid turnaround in US dollar reserves. “We don’t expect a rapid shift in reserves because the reason the dollar is used as a reserve currency is the strength of the U.S. economy and the depth of its capital markets,” she said. “It’s not time to say goodbye to your dollars.”

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