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Despite a wave of protests and calls for reform throughout the Gulf Co-operation Council (GCC), Qatar has so far remained unaffected. There have been no protests, and the Qatari government has not followed other GCC countries in announcing measures to address domestic issues.

Several Gulf economies have returned to the international debt markets as they try to get to grips with the fiscal challenge of low oil revenues, subdued economic activity and a need for high spending to offset coronavirus’s impact.

While the late Emir Sheikh Sabah was a giant on the regional diplomatic stage, his legacy at home is more mixed. Less drawn to economics than politics, he proved unable to shepherd the economy onto a more sustainable, long-term footing away from oil and gas dependency.

Royal Court advisor and former economy and planning minister Mohammed Maziad Al-Tuwaijri survived the first round of the hunt for a new director general of the World Trade Organisation (WTO), progressing on 18 September to the next stage alongside Nigeria’s Ngozi Okonjo-Iweala, South Korea’s Yoo Myung-hee, Kenya’s Amina Mohamed and the UK’s Liam Fox.

Dubai’s total debts are likely to be far higher than the $33.6bn the emirate stated in a $2bn bond and sukuk prospectus last month, according to London-based Capital Economics.

Announcing job losses and investment cutbacks, many of Big Oil’s flagship companies have been making dramatic announcements of changes in strategic direction. This is most marked among European majors BP, Eni, Royal Dutch Shell and Total, if not by their US peers ExxonMobil and Chevron Corporation; it suggests that many industry leaders now see their futures as diversified energy companies, rather than old-style international oil companies (IOCs).

Risk Management Report – GSN Risk Grade – E↓5↓ POLITICS: Confronted by conflict, which has exacerbated multiple humanitarian crises, Yemen has long teetered on the verge of collapse and ‘failed state’ status (GSN’s political risk category F).

GSN’s year-end Perspective/Agenda feature provides a look back – and forwards – at key events across the region in 2020-21. It gives an opportunity to update the Risk Grades included with each of our regular Risk management reports. After another year of tragedy, Yemen is effectively a failed state (rated F6, the bottom political and financial grades). Qatar has shown itself to be robust in the face of its neighbours’ boycott, its finances warranting an upgrade to 1, putting it on a par with the UAE. Iraq’s political standoffs and financial woes remain deeply troubling, but the situation is improving rather than deteriorating and the prospect of higher oil prices next year should help further; it has been upgraded from E5↑ to D4↓. Oman’s fiscal challenges continue to mount, prompting a downgrade of its economic rating to 3. 

Risk Management Report – GSN Risk Grade – D↓4↓ Overview Politics: Disagreements between the autonomous Kurdistan Region of Iraq (KRI) and the federal Iraqi government in Baghdad have been a source of major tensions. The 2005 constitution gave the KRI an identity distinct from Iraq, as a federal entity recognised by Iraq and the United Nations; the 2010 Erbil agreement outlined how power would be shared. The Kurdistan Regional Government (KRG) has long protested these agreements’ lack of implementation.

Emerging apparently from nowhere, the Neom development’s futuristic urban vision The Line has attracted a lot of international media attention. This is not surprising as this area of Neom alone is intended to create 380,000 jobs and contribute SR180bn ($48bn) to Saudi gross domestic product by 2030; a figure greater than neighbouring Jordan’s entire current GDP. The development will be powered entirely by hydrogen and other renewable energy, underlining the wider Neom project’s status as by far the Public Investment Fund (PIF)’s most ambitious scheme – a blend of state-of-the-art design and public relations gloss intended to ensure Saudi Arabia is associated with global innovation, rather than human rights abuses and intolerance.

Budget talks in Baghdad are going down to the wire over the thorny issue of allocations to the Kurdistan Regional Government (KRG). The negotiations are the latest manifestation of a long-running dispute between Iraq’s centre and its periphery that has proved stubbornly immune to resolution since the late Saddam Hussein’s Baathist regime was ousted in 2003. There is added friction in the Baghdad-Erbil standoff, with Iraqi Shia parties increasingly vexed at what they view as a resurgence of Kurdish independence hopes.

London think tank the International Institute for Strategic Studies (IISS)’s annual Military Balance shows that Oman retains its position of having the largest defence budget as a percentage of GDP, at 12%, up from 9.9% in 2019. Kuwait and Saudi Arabia are in joint fourth place in the IISS rankings of the world’s biggest defence spenders, at 7.1% of GDP each. Iraq, the UAE and Qatar also make the global top 15 on this measure, with 5.8%, 5.6% and 4.4% of their respective GDPs.

Seychelles President Wavel Ramkalawan requested budget support from the UAE, either as a grant or a soft loan, during a 19-22 February visit to Abu Dhabi, accompanied by foreign affairs and tourism minister Sylvestre Radegonde. Ramkalawan was last in Abu Dhabi only in December.

There have been further oil and arrears payments by the Kurdistan Regional Government (KRG) to international oil companies (IOCs) in recent days, according to announcements by London-listed Genel Energy, and Gulf Keystone Petroleum (GKP), and Oslo Stock Exchange-listed DNO ASA. Data for January sales were published by Genel, which said it had received its share of payments for the month from Tawke ($10.9m plus an override payment of $6.5m), Taq Taq ($2.6m) and Sarta ($1.5m), plus a receivable recovery payment of $2.4m for unpaid invoices from 2019-20.

Faisal Bin Fadel Bin Mohsen Al-Ibrahim was named economy and planning minister in a series of royal orders by King Salman Bin Abdelaziz Al-Saud on 3 May. He is the third economy minister in the past 14 months. Al-Ibrahim, an alumnus of Saudi Aramco, had been deputy minister of economy and takes over from finance minister Mohammed Al-Jadaan, who had been acting economy minister since March 2020.