Oman, often deemed to have the weakest economy among the six-nation GCC, is at the forefront of concern/Bloombergby Bloomberg
The International Monetary Fund (IMF) said that dollar pegs in the Gulf have proven effective even as the region now faces COVID-19 outbreak and oil prices crash.
Jihad Azour, the IMF’s Director for the Middle East and Central Asia, said that billions of dollars’ worth of stimulus packages were rolled out to cushion regional economies after the pandemic, but growth for the remainder of the year will depend on whether the global economy will recover fast or not.
Dollar pegs in the Gulf have been serving very well and it’s still appropriate, especially countries who have buffers that have the ability to use their reserves in order to address the shock, said Azour.
Oman, often deemed to have the weakest economy among the six-nation GCC, is at the forefront of concern.
“Oman has a higher level of debt and maybe less buffers, therefore, for Oman the policies have to be maybe less expensive,” said Azour.