Research and Insights

2024 has seen relatively positive economic developments for countries in the Middle East not directly involved in the Gaza crisis. However, the year has still been challenging for the region, with the economic impact of the conflict extending to neighbouring countries. In June, OPEC+ overcame internal tensions and agreed to extend its cooperation agreement at least through 2025 and a further adjustment was made in September, reflecting renewed supply-demand dynamics in the oil market. Additionally, non-oil sector growth indicators look solid this year. Fiscal outturns have also been positive so far, with the UAE, Qatar and Oman achieving surpluses and Saudi Arabia narrowing its deficit. In this report, we also explore two themes in detail. First, Egypt has experienced a remarkable economic turnaround this year, following a US$35bn investment from the UAE. This has enabled the implementation of important reforms, including a liberalisation of the currency regime, which has helped to bring down inflation. As a result, Egypt has managed to unlock additional funding support from multilateral institutions and a more positive view from the market, leading to lower government debt yields. However, significant challenges remain, including the ongoing disruption to trade through the Suez Canal and persistent challenges with poverty and underemployment.

شهدت المنطقة سلسلة من التطورات البارزة خلال الأشهر التي أعقبت صدور التقرير الأخير حول المشهد الاقتصادي في الشرق الأوسط. أولًا، قررت مجموعة أوبك+ خفض إنتاج النفط لهذا العام بنحو الثلثين، مع تمديد الخفض الطوعي حتى نهاية عام 2026. ويساهم هذا القرار، إلى جانب الضغوط التي يمارسها الرئيس دونالد ترامب لزيادة إنتاج الوقود الأحفوري في الولايات المتحدة، في إعادة تشكيل ملامح أسواق النفط العالمية، مما يضيف حالة من عدم اليقين بشأن مسار أسعار النفط في عام 2025. ومع ذلك، تظل آفاق نمو القطاعات غير النفطية في اقتصادات دول مجلس التعاون الخليجي واعدة.

FY24 saw the highest GCC IPO volumes on record with 53 listings across the region. UAE IPOs represented nearly half of total GCC IPO proceeds in 2024. Q4 2024 marked the busiest quarter of 2024 with 26 IPOs. Tadawul's parallel Nomu market continues to attract companies with 27 IPOs across a diverse range of sectors.

The banking sector in Saudi Arabia is undergoing a profound transformation, driven by Vision 2030’s ambitious agenda and the rise of digital technologies. As financial institutions embrace these changes, they are working to enhance customer experiences, innovate their services, and navigate an increasingly competitive landscape. The Saudi Arabian Monetary Authority (SAMA) has introduced forward-thinking regulations aimed at fostering financial inclusion, strengthening digital banking infrastructure, and creating opportunities for both traditional banks and fintech players.

2024 has seen relatively positive economic developments for countries in the Middle East not directly involved in the Gaza crisis. However, the year has still been challenging for the region, with the economic impact of the conflict extending to neighbouring countries. In June, OPEC+ overcame internal tensions and agreed to extend its cooperation agreement at least through 2025 and a further adjustment was made in September, reflecting renewed supply-demand dynamics in the oil market. Additionally, non-oil sector growth indicators look solid this year. Fiscal outturns have also been positive so far, with the UAE, Qatar and Oman achieving surpluses and Saudi Arabia narrowing its deficit. In this report, we also explore two themes in detail. First, Egypt has experienced a remarkable economic turnaround this year, following a US$35bn investment from the UAE. This has enabled the implementation of important reforms, including a liberalisation of the currency regime, which has helped to bring down inflation. As a result, Egypt has managed to unlock additional funding support from multilateral institutions and a more positive view from the market, leading to lower government debt yields. However, significant challenges remain, including the ongoing disruption to trade through the Suez Canal and persistent challenges with poverty and underemployment.