GCC governments’ monetary policy is not geared to the region and authorities need to control the amount of money in circulation if they cannot control its price, Lyons said. ‘By tying to the US dollar, you tie to the policy of the US. It gives monetary credibility, but if your economy accelerates relative to the US, where interest rates are low, it fuels speculation, for instance in housing,’ Lyons said.

The economic boom in the Gulf is sustainable if governments create more investment opportunities, Lyons said. ‘There’s a phenomenal amount of money and people here. The big challenge is to diversify and open the economy and make the service sector buoyant and dynamic.’