The Middle East Economy

With Jordan’s economic outlook at best mixed for the time being, the kingdom’s government is exploring tax increases as one way to keep the budget solvent. However, officials are nevertheless keen to ensure these tax hikes do not hinder common daily economic activity for most of the population, especially now that Ramadan has begun.

Conscious that its economy is currently highly dependent on oil and closely tied to markets that continue to face economic uncertainty, Kuwait’s government is looking further afield to new investment destinations as well as to moves to stabilise oil prices.

Higher-than-forecast oil revenues should allow Oman to sustain economic growth for the rest of the year, as well as put its budget into the black. There is, however, a serious caveat. A weakening of global markets and any delays to the state’s efforts to strengthen its economic base could negatively impact year-end figures.

Prices in Dubai’s residential property segment have posted solid growth over the past few months, and other areas of the sector are also showing signs that recent declines are beginning to reverse. However, due to excess supply in many segments, it will be some time before demand catches up with new development.

A determined optimism is pervading Dubai’s markets, with the emirate’s growth set to top many expectations this year. Few would suggest, however, that the emirate is immune from the looming debt crisis in Europe.

Ras Al Khaimah’s (RAK) economy is on track to post a second year of solid growth. The emirate, however, is also keeping an eye on any signs of economic slowdown or political instability elsewhere in the region, which could impact its overall expansion.