The GCC economic outlook in the coming 10 years

The GCC economic outlook in the coming 10 years

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Governments around the world are adopting different schemes and legislations to attract international direct investments.

The volatility of the currency prices is one thing investors just take into account seriously because the unpredictability of currency exchange rate fluctuations could have a direct effect on their profitability. The currencies of gulf counties have all been pegged to the US currency from the late 1990s and early 2000s, and investors such Farhad Azima in Ras Al Khaimah and Oussama el-Omari in Ras Al Khaimah would likely view the fixed exchange price being an crucial attraction for the inflow of FDI in to the country as investors don't have to worry about time and money spent handling the forex instability. Another important benefit that the gulf has is its geographical position, situated on the crossroads of three continents, the region serves as a gateway towards the rapidly growing Middle click here East market.

To examine the viability of the Arabian Gulf being a location for international direct investment, one must evaluate whether or not the Arab gulf countries provide the necessary and sufficient conditions to promote FDIs. One of the important variables is political security. How can we evaluate a state or perhaps a region's security? Political security will depend on up to a significant extent on the content of citizens. Citizens of GCC countries have lots of opportunities to greatly help them achieve their dreams and convert them into realities, which makes a lot of them content and happy. Moreover, global indicators of political stability unveil that there is no major governmental unrest in the region, as well as the occurrence of such a scenario is extremely unlikely given the strong governmental will as well as the vision of the leadership in these counties specially in dealing with political crises. Furthermore, high levels of corruption can be hugely harmful to international investments as potential investors fear hazards such as the blockages of fund transfers and expropriations. Nevertheless, regarding Gulf, political scientists in a study that compared 200 counties categorised the gulf countries as being a low hazard in both categories. Certainly, Ramy Jallad in Ras Al Khaimah, a prominent investor may likely attest that a few corruption indexes make sure the region is increasing year by year in reducing corruption.

Countries around the globe implement different schemes and enact legislations to attract foreign direct investments. Some nations such as the GCC countries are increasingly implementing flexible laws, while others have actually reduced labour expenses as their comparative advantage. The benefits of FDI are, needless to say, mutual, as if the international organization discovers reduced labour costs, it's going to be in a position to minimise costs. In addition, if the host country can give better tariffs and savings, the company could diversify its markets via a subsidiary branch. Having said that, the state should be able to grow its economy, cultivate human capital, enhance job opportunities, and provide access to knowledge, technology, and abilities. Therefore, economists argue, that in many cases, FDI has led to effectiveness by transmitting technology and knowledge towards the country. Nonetheless, investors look at a myriad of factors before deciding to move in a state, but among the significant variables which they give consideration to determinants of investment decisions are position on the map, exchange volatility, governmental security and government policies.

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