All six states now have budget surpluses. The combined current account surplus of the GCC this year will be at least $55,000 million. Since the end of 1995, the six have accumulated BoP surpluses approaching $200,000 million and eliminated practically all their outstanding international debts.
Inflation has been modest and the exchange rates stable. The sole negative macroeconomic feature of significance is the policy of linking GCC currencies to the dollar, which has led to a sharp drop in the region’s external purchasing power in the past two years.
Anyone acting on the forecast of a golden GCC future that autumn could have done very well. Somebody who invested across the Saudi stock market at the end of 1995, and you had to be a Saudi Arabian to have been able to do that then, would now be enjoying the fact that the kingdom’s all-share index is 224 per cent higher today than it was this time 10 years ago. This compares with a capital gain of just over 100 per cent for people who had their money tied up in British equities.
You are probably wondering why there is such a clear recollection of a forecast made so many years ago. There is a good reason: I was the one who made it.
But take comfort in the following thought. However right I may have been then, you are almost certainly richer than me now.