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Non-oil growth in GCC countries forecast at 4 to 5 per cent: Report

Member nations pressing ahead with mega infrastructure projects and spending schemes to support their economies

The non-oil sector in member countries of the Arab Gulf Cooperation Council (GCC) is forecast to maintain a growth rate of 4.5 per cent, but the oil sector will continue to remain under price pressure despite a relative recovery recently.

The National Bank of Kuwait said in a report that GCC members are pressing ahead with mega infrastructure projects and spending schemes to support their economies.

The report, published by the Kuwait News Agency (KUNA), indicated that members of the six-nation regional grouping have abundant financial reserves that serve as a buffer to finance public spending on the short and medium terms.

However, the bank said volatility in global markets beat all projections, especially during the third quarter of the current year, mainly because of the Chinese economic slowdown and the US Federal Reserve’s move on interest rates.

The report spoke about measures that the Chinese government has taken to prop up financial markets but said they were fruitless.

The Chinese government sought to douse markets’ fears by easing lending laws, cutting interest rates and facilitating currency exchange rates trade, but all of these measures failed to assure investors or put financial markets back on track.