GCC Visions and the Impact of It

This article discusses the strategies and impact of GCC visions on economic integration and diversification. It explores the challenges faced by GCC countries and their goals for the future. The article also highlights the importance of education and the role of the private sector in achieving these visions.

Running Head: GCC VISIONS 1
GCC VISIONS, AND THE IMPACT OF IT
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Introduction
The strategies by the GCC states are written documents that demonstrate their vision
and what they intend to achieve in both the short and long-term efforts. These plans
aspirations to constructive decision making in relation to the existing economic dynamics
Although most of the visions have been drafted by foreign consultancy firms, it has
significantly helped in the transfer of knowledge that would be used to improve the key
ideologies and also consider the best international accepted practices. That being said, the
official strategy incorporate agreement from all the GCC states to carry out free trade.
This is envisioned to help in achieving economic integration as the countries advance
to higher economic prosperity. This would later lead to the establishment of a common
market among the member states, in accordance with the set timeframes .Moreover, this
mechanism would foster the involvement of the private sector particularly those who
subscribe to the ideas of bringing economic integration. As a result, the GCC program was
established in order to examine the most appropriate economic diversification and investment
strategies that would benefit all the six member states. Those investors further establish
economic preconditions as a way of ensuring that the well-being of the economy was
guaranteed. It can be argued that the Gulf economies are currently performing in their full
potential as there are multiple opportunities and demands for resources, driven by high social
and economic expectations .Lastly, the biggest challenge for the GCC is to develop a way of
achieving the collective economic vision and at the same time build a sustainable society
(Lauridsen, 2010). For this to be achieved, the countries ought to look beyond oil and gas as
their main source of revenue, and come up with new alternatives.
Discussion
The key driver of Gulf States economies are the huge oil reserves and the ever
increasing demand for oil products .Therefore, the GCC regional states are striving towards

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diversification .However, oil resources have been on the decline across the world and as a
result, there is an increase in prices as well as the demand of the commodity (Al-Maamary,
Kazem,& Chaichan,2017).The policies for the diversification of the economy under the GCC
demonstrates that most of the economies under this umbrella mostly depend on oil revenues
more than other economic activities. Such a situation would often result to lack of incentives
to develop an well-organized economic foundation within the countries .It is important to
note that the establishment if a solid economic foundation determines the ability of a country,
through taxation, to reinforce its power both locally and globally (Ulrichsen,
2014).Therefore, production and distribution states ought to always understand as opposite
immoderations on a continuum.The dependency of these states on hydrocarbons has proven
to be a challenge as the production has been fluctuating over the past decade. That being said,
such strains bring in a number of challenges towards the accomplishment of economic
diversification in the Gulf countries (Kiel, 2012).
The Gulf Cooperation Council (GCC) are determined to strengthen their economic
powers and increasing welfare. They aspire to achieve this by considering the common
aspects of the economies and harmonising their visions through joint economic policies. As
the GCC states share common vision concerning economic development, they have
highlighted some of the fundamental areas of diversification that would ensure that
dependence of oil and gas is reduced (Krane, & Hung, 2016).Such include; education,
knowledge-based economies, conservation of environments and tourism. The strategies for
national growth possesses a long history in certain GCC states on an approach that aimed at
pursuing certain laws on oil selling prices. While other countries focus on developing
education others in the GCC states are primarily focusing on improving the desirability of the
economies in the global arena (Rupp, 2009). In addition, some of the most recent alternatives

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give emphasis to commercial diversification as well as the drastic increase in the involvement
of the small enterprises (Todaro, 2009).
Development planning of the GCC countries
Nowadays, the Arab Gulf states are emphasizing more on political precedence in their
quest for key economic drivers, as they seek to widely pursue long term development focus.
What follows is the examination of the existing plans, with key focus to the major economic
growth for all the six GCC states (Gengler, 2016). Economic development is a rather new
concept in the GCC states with the exclusion of Saudi Arabia and Oman. Physical planning
has been conducted in these countries to certain degrees particularly in the prosperous years
of the 1970s, with the objective of harmonizing the tangible development of cities among
other key projects (Waldman, 2016).That being said, plans mirrors the historical contexts in
which they were founded. The contextual factor appears to be of great relevance in the
frameworks of these planning efforts. Such plans include neoliberal economic focus, which
constantly dominates the understanding of multiple GCC economic plans (Luciani, 2013).
Currently, an ambitious investment program is being conducted in an effort to expand the
capacity of industries such as real estates, transport, manufacturing and tourism among
others, with the amount invested exceeding $ 1 trillion for the next decade (Hvidt, 2014).
I. Qatar National vision 2030
The Qatar National Vision 2030, is a master vision that acts as a
roadmap towards the country becoming a developed society with the
capabilities of assuring sustainable development , through the
provision of high standards of living for all its citizens by the year
2030. (Lahn, & Stevens, 2011).
The plan provides long-term outcomes for the country as well as
frameworks within which national strategies and their implementation

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can be developed. It is designed in way that it helps the government
in developing policies , and allocation of resources towards the unified
GCC goals .Moreover , it was established to provide the private sectors
with a shared direction and purpose . In fact, most private company are
making their reference to the QNV2030 in their mission statements (Yamada, 2011).
Even though Qatar has significantly benefited from Hydrocarbon products , It is
constantly focusing on diversifying its economy to one which is knowledge-based .
Understanding the importance of education is the first criterion .Through the collective
GCC framework , Qatar is expanding its education system to match that of most
advanced nations around the world. That being said, most of the country’s post-secondary
education, cultural and scientific research are driven by the Qatar foundation (Khajehpour,
2014).
II. Kingdom of Bahrain 2030 vision
The Kingdom of Bahrain is a small country, which in the past years has been
experiencing a decline in oil reserves compared to other GCC countries .The population of
the country is about 1.2 million including 670,000 foreigners .In the past two decades , the
country has been pursuing new strategies that would ensure strategic diversification by 2030.
Most recent industrial developments include industrial refineries, Shipyard manufacturing,
and Aluminium smelting industries among other relevant industries (Karolak, 2012).
The Kingdom of Bahrain has taken a number of steps to adopt the new Sustainable
Development Goal (SDGs) 2030. This has been achieved after the country completed the
Millennium development goals before schedule in 2015.The leadership focused on these
goals and was committed to accomplishing them since their implementation in the years
2000.The projections were split into four national reports that would help in monitoring the
progress while achieving them. All the reports were prepared with the support of the United

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Nations Development Programme (UNDP) (Bayne,& Woolcock,2011).They reflected the
achieved progress over the past decade as a way of demonstrating the outcome of the
important programs that were taken by the government. In an effort to diversify their
economy and help boost productivity. The country has witnessed great achievements from
the GCC programs through the formation of numerous institutions which in turn have highly
advanced the living standards of its citizens. Such systems include social care, development
of quality education and its outputs, addressing social inequality and supporting vulnerable
people in the society.
In the vision 2030, the Kingdom of Bahrain envisions at providing more opportunities
for economic empowerment for the younger generation. Other programs focus on supporting
political and economic participation of women, the protection of the environment, ensuring
constant sustainability of the overall development of Bahrain. A 2016 report by the UNDP
included the excellent achievements of the past 15 years by the Bahrain government and its
commitment to achieving Millennium Development Goals. Based on such accomplishments,
the GCC has enjoyed high rates of economic growth .The GCC has developed into an
emerging financial centre with industries such as tourism and manufacturing recording the
highest growth. As a result, the nation states have seen significant capital inflows due to high
oil prices for several years. These developments are expected to continue regardless of the
recent fluctuating rates due to volatility in the global economic climate. Even though it is a
regional problem, this has been a big challenge for Bahrain, given the country's first move in
proposing new economic strategies (Coates Ulrichsen, 2011).
III. The Oman 2020 vision
Since the early 1970s, Oman has directed much of its oil revenues to other industries.
Oman is a small country with approximately 2.7million permanent residents and an
additional 820,000 foreign nationals. The state has established short-term plans for economic

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diversification, where most of the policies are now focusing on agricultural diversification,
maritime protection, and climate change (Woertz, 2016). By 2010, among the GCC states,
Oman recorded the most developed economy. Since the oil and gas reserve are declining,
Oman appears to have chosen other available paths towards diversification by reinvigorating
the private sector. Since 20000, the government has made substantial economic reforms to
improve its business environment that has opened up foreign investment. However Oman still
largely depend on oil reserves, while the tourism sector holds significant promise for the
future of the country. However, the country’s tourism infrastructure is still underdeveloped
mostly in rural areas.
As presented in the table below, the specific diversification projections aim at
reducing the dependency of the oil and gas sector to 9 % by 2020. However, since 2011 Oil
has accounted for 41% of the total GDP while tourism and other industries contributed about
59 %.( Outlook, 2009).
IV. UAE Vison 2021
Currently, the UAE has given much political priority towards economic
diversification as it has begun pursuing strategic terms such as revisiting major project plans
and implementation of investment plans through the GCC. Such efforts are directed towards
motivating potential investors to diversify their focus on other economic opportunities other
than oil and gas (Hvidt, 2012).
Notably, the UAE has established a model of allocation designed in a way that it
emphasizes even distribution of resources .However this model fails to put more support on
the GCC strategies on development .It further fails to create more opportunities such as
education for all citizens or creating employment for young individuals. Therefore, UAE has
recently begun seeking the most appropriate solutions to develop the economies towards
diversification of resources (Habibi, 2011). While hydrocarbon products have been the key

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source of revenue for the UAE in the past half-century, other industries have been established
such as the Aluminium Smelting industry, tourism, business expos among others. All these
projects were established with the aim of expanding economies by redirecting oil revenues in
other industries (Almutairi, 2016).
V. Saudi Aribia Vision 2030
The Saudi plan was drafted as the leadership of the country responded to the
fluctuating oil prices and the huge budgetary losses it brought from the government .Even
though no plan is the same from other countries, they have all included several common
development agendas (Krane,2014).One major intention was to create knowledge-based
economies in which growth is driven by innovation, research, and development as well as the
creation of internationally competitive economic sector (Kumar, & van Welsum, 2013). That
being said, there is invariably huge emphasis on strengthening and diversifying the private
sector as a way of creating new jobs for the young generation (Cottarelli, et al., 2010).
Major attempts in Saudi Arabia and Bahrain to nationalise the workforce and motivate
more citizen to get into the private sector ran into huge opposition especially from the
business elites, who felt threatened by such moves. Such cases highlight the challenges of
making sustainable policy reforms that would confront the powerful layers of vested interest
and can survive any opposition by the influential actors (Ulrichsen, 2016). In addition, they
show the private sector can position itself against the attempts of the government to make any
reforms on what majority of the elites consider as a threat to their access to huge reserves of
cheap labor. This makes it challenging to work together with the key stakeholders including
government parastatals, private organisations and civil society groups in support for a
common vision (Hertog, 2014).

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Table 1. Oil percentage as an economic indicators in the Gulf countries
Country % of export
earnings
% of state budget % of GDP
Bahrain 71 87 25
Kuwait 89 96 46
Oman 67 78 43
Qatar 90 82 46
Iran 86 86 58
UAE 71 78 35
VI. Kuwait “New Vision 2035”
The first vision by Kuwait was drafted using a considerable amount of public
resources by a team of consultants working in the name of former British Prime Minister
Tony Blair. This resulted in huge political unrest in Kuwait when the cost of the plan leaked
to the media. As a result, the plan was never implemented and a new plan was put together
under the name “vision 2035.” (Valeri, 2013).However, through new vision 2035, Juwaut will
benefit from diversification of their economies. Since it is a long-term focus , it will
strengthen its long-term growth and protect its economy from oil-driven one to a
knowledge based system, a fundamental source of macroeconomic volatility . An open
economy would enable Kuwait achieve sustainable growth. Such plans would lead to the
creation of more productive jobs , a fundamental priority in such a country where large
populations of youths are still unemployed.
It is important to note that the approach used in Establishing the GCC strategy varies
with the countries as some of them published long-term focus while others have short-term
plans. All this has been determined by the available resource in each member country as well
as their respective spending budget. The overall vision of the countries focuses more on

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economic incentives in an effort to integrate private sectors towards the target
plan .Typically, the vision incorporates both short term and long-terms timeframes that would
be used to measure whether the projections have been accomplished in the various sectors of
interests (Hvidt, 2014).Some of the key area of focus include; creation of employment
opportunities, GDP growth, an improvement of life through the available resources.
Table 2. Major initiatives launched during the GCC period
Country Year Vision
Bahrain 2008 Economic vision 2030
Kuwait 2010 New Vision 2035
Oman 1995 Oman 2020
Qatar 2010 Qatar National Vision 2030
Saudi Arabia 2016 Saudi Vision 2030
UAE 2010 Vision 2021
The policy-making process in the GCC states often occurs against the backdrop of
highly distinctive drivers of monetary and budgetary frameworks that make it challenging to
adapt much more constructive models of economic transitioning to other industrial settings
(Ziaei, 2013). The role of the GCC governments as the distributor of resources, in large part
through job creation, often complicates the task of aligning the economic and political
rationales for reforms. As a result, it contributed to slow policy development. A good
example is Oman whose leadership exemplifies the impact of visible political responses to
the Arab spring on the long-standing policies motivating Omanis into investing in the
country’s private sector. This is one of the fundamental elements of Omani’s “vision 2020”
which was unveiled in 1995. While the number of private workforces has significantly
increased by 138% between 2003 and 2010, much of the progress was turned back by the
announcement of approximately 35,000 jobs in the public sector in spring 2011.This resulted
in over 35,000 private employees resigning from the private sector that year (Takagi,
2016).

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The delicate politico-economic equilibrium often limits the room for manoeuvring
around the fundamental issues that have been considered by the GCC states as a prime target
for reform in their respective strategic visions. This not only shows the entrenched durability
of the vested interest but also the pattern whereby the leadership prioritises the watering
down policy reforms over active confrontation with the opposers (Kamrava, 2012).,
Conclusion
Every diversification strategy reflects the historical backgrounds in which it was
formed and it, thus, mirrors the leading ideologies considered as continuities and the global
financial situations among other key components .As discussed, strategies and political
records are often used as clear signals to the intentions of leadership to the citizens and serve
multiple purposes other than ordinary implementation .The previous analysis has
demonstrated the main objectives of the GCC.
In general, the GCC states share the goals of economic diversification away from just
the dependency on oil products. There are multiple reasons behind this. For instance, Oman
and Bahrain have long signalled the urgency in wanting to achieve economic diversification
because of the small and rapidly dwindling oil reserves (Endowment for International Peace,
2019). Moreover, UAE, Qatar, and Kuwait have shown very little urgency. For instance,
Qatar has deliberately developed a slow diversification framework while Saudi Arabia falls
between these two.
Two major reasons have been highlighted as the drivers of the GCC. First, with the
rapid population growth and the prospects of reduced oil revenues to levels that some of the
states can no longer sponsor their economies and well as the big societies that have been
established over the past decade. Second, the motivation of economic diversification is the
creation of job opportunities both in content and revenue, for the growing population of
youths. Both concerns require GCC communities to be economically active. Further, all the

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GCC states give emphasis to on the provision of great education and healthcare for their
citizens. They are considered as an end in themselves, but also as a condition for the
economic transformation from low-importance to high- importance industrial economies. The
“aimed for knowledge” economy assures to offer jobs with content of knowledge. Such Jobs
ought to result in higher income for the citizens and thus as a prerequisite for a suitable
revenue for the economy at large.

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