Report: Saudi Arabia, Kuwait & Bahrain Economic Outlook

Description

The economies of all six countries are dependent to varying degrees on hydrocarbon earnings, which accrue primarily to the state (see Table 1). The generally small populations (with the exception of Saudi Arabia), combined with the huge hydrocarbon earnings accruing to the state has resulted in high infrastructure spending, the emergence of a private sector that is heavily reliant on government contracts and a strong reliance on expatriate labour. The lack of democratic checks and balances has also seen the emergence of a private sector elite closely tied to the political elite, meaning that commercial legalisation and regulations often create barriers for foreign companies and local businesses without ties to the regime. Positively, the oil revenues have traditionally meant a low tax environment, although this is set to change over the next decade.

40 pages.