A series of financial shocks are testing the Gulf economy and educating the region that it cannot defy global forces. The GCC will end up looking very different when they pass.
A bad October for GCC capital markets has been followed by a terrible November.
The Dubai Financial Market (DFM) fell by 24 per cent in the first 13 days of the month and is down more than 60 per cent since January. Trends in other Gulf markets are similar.
The GCC, because of its savings and the world's abiding appetite for energy, is partly insulated against the financial crash that will send the world into recession in 2009. But it will suffer nevertheless. In some areas, the Gulf is remarkably vulnerable.
It is said that a financial tsunami is sweeping the world. In fact, seven waves, not just one, have been unleashed.
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A series of financial shocks are testing the Gulf economy and educating the region that it cannot defy global forces. The GCC will end up looking very different when they pass.
