Fiscal Adjustment in the Gulf Countries: Less Costly than Previously Thought

Fouejieu, Armand; Rodríguez, S.; Shahid, Sohaib

doi:10.5089/9781484361573.001

Cited by 4 publications

(3 citation statements)

References 13 publications

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“…In the following fiscal years, UAE focused more on revenue generating policies to improve revenue collections and cover budget deficits. Using such strategies, the UAE was able to keep its revenue growth stable over time and significantly increase its budget in FY 2018 (Fouejieu, Rodriguez, & Shahid, 2018;Garcia & Hé nin, 1999;UAE Ministry of Finance, 2019).…”

Section: Discussionmentioning

confidence: 99%

Budget Policies During and After the Oil Crisis of 2014: Comparative Analysis of Saudi Arabia, UAE, and Kuwait

Alotaibi¹

2019

IBR

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This paper explored how some Gulf Cooperation Council (GCC) countries employed budget policies to manage their budget deficits in the fiscal years between 2014 and 2018. Empirically, this study attempted to summarize and critically analyze several approaches of economic strategies that countries utilized such as sovereign wealth fund, revenue-increasing policies, and expenditure-reducing policies in response to budget deficits during and after the oil crisis of 2014. Secondary data were gathered from the ministry of finance reports as well as various official documents covering three different GCC countries, which are Saudi Arabia, UAE and Kuwait. The findings of this study showed distinct patterns in a three-country approach to manage their budget deficits. Saudi Arabia and UAE implemented a comparatively more balanced approach between increasing revenues and reducing expenditure. On the other hand, Kuwait focused on reducing their budget expenditures and adopted policies that promoted across the board cuts and is relatively relying more on oil revenues to balance the budget.

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Section: Discussionmentioning

confidence: 99%

Budget Policies During and After the Oil Crisis of 2014: Comparative Analysis of Saudi Arabia, UAE, and Kuwait

Alotaibi¹

2019

IBR

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“…in Fouejieu, Rodriguez, and Shahid (2018). For example, a fiscal consolidation of 10 percentage points of nonhydrocarbon GDP at time t reduces real nonhydrocarbon growth by 2 percentage points at time t, a further ½ percentage point decline at time t+1, and so forth with the impact waning over time.…”

Section: Annex 1 Technical Notesmentioning

confidence: 99%

The Future of Oil and Fiscal Sustainability in the GCC Region

Mirzoev¹,

Zhu²,

Yang³

et al. 2020

Departmental Papers

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The oil market is undergoing fundamental change. New technologies are increasing the supply of oil from old and new sources, while rising concerns over the environment are seeing the world gradually moving away from oil. This spells a significant challenge for oil-exporting countries, including those of the Gulf Cooperation Council (GCC) who account for a fifth of the world’s oil production. The GCC countries have recognized the need to reduce their reliance on oil and are all implementing reforms to diversify their economies as well as fiscal and external revenues. Nevertheless, as global oil demand is expected to peak in the next two decades, the associated fiscal imperative could be both larger and more urgent than implied by the GCC countries’ existing plans.

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“…The oil sector in the GCC also influences the non-oil sector through the governments' expenditure function. Since oil revenue is the main source of fiscal revenue, the effect on the non-oil economy is seen through the government spending these revenues on compensation to public sector employees, subsidies and transfers, and investment in infrastructure, real estate, education, and health(Fouejieu et al 2018). GCC countries are focusing on decoupling public spending from volatile oil prices, including through the use of medium-term fiscal frameworks.…”

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confidence: 99%

U.S. Monetary Policy Spillovers to GCC Countries

Adedeji

Roos²,

Shahid³

et al. 2019

IMF Working Papers

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This paper provides empirical evidence that the size of the spillovers from U.S. monetary policy to non-oil GDP growth in the GCC countries depends on the level of oil prices. The potential channels through which oil prices could affect the effectiveness of monetary policy are discussed. We find that the level of oil prices tends to dampen or amplify the growth impact of changes in U.S. monetary policy on the non-oil economies in the GCC.

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Fiscal Adjustment in the Gulf Countries: Less Costly than Previously Thought

Cited by 4 publications

References 13 publications

Budget Policies During and After the Oil Crisis of 2014: Comparative Analysis of Saudi Arabia, UAE, and Kuwait

Budget Policies During and After the Oil Crisis of 2014: Comparative Analysis of Saudi Arabia, UAE, and Kuwait

The Future of Oil and Fiscal Sustainability in the GCC Region

U.S. Monetary Policy Spillovers to GCC Countries

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