GCC countries to invest $200bn on 20 energy projects

The move towards sustainable and renewable energy sources is gaining momentum in GCC countries and throughout the world, as countries try to secure alternative energy resources to fuel other related projects, such as building water desalination plants and supplying power to developing areas.

However, progress in carrying out these projects was hampered as fears arose regarding the risks of increased global economic instability.

Dr Abdullah Al Amiri, Chairman of the Emirates Energy Award, said, "The GCC countries have overcome the fears associated with any predictable decline of energy funds following the US economic recession, or a fall in oil prices.

The theory that either of these two situations would have a negative effect of the GCC countries has proved to be incorrect, as several current findings seem to indicate the contrary. The US mortgage market woes did not spread to the GCC markets, while the fuel prices are still soaring on the global markets.

The high amount of liquidity injected into the region will secure the market against any slump. The foreign reserves available in the market, estimated at $455 billion in 2008, up from $365bn in 2007, will further defend the market against any fall."

In light of these encouraging initial results and successful experiments, GCC countries can safely invest in the energy sector as there is an increasing global trend to raise investment to cover the $40bn required in the petrochemical sector by 2010.

GCC petrochemical production contributed 7% to the world's total production.

GCC countries are to invest $160-200bn in between 14 and 20 energy projects.

The growth of the six countries is expected to remain within the world growth rate, due to the $132bn current account surplus, and they have already start playing an increasingly major role as exporters of capital for emerging countries - estimated at $30bn, according to the latest report on world growth issued by the International Bank - with more investment to be pumped into the region from the GCC countries.