Gulf oil exporters’ current account surpluses are expected to fall this year on rising domestic investment and softer oil prices, said the International Monetary Fund said.
But the global spending spree undertaken by Gulf states, snapping up international companies and real estate nevertheless looks set to continue.
The fund’s half-yearly regional economic outlook for the Middle East and Central Asia region said oil-exporting countries’ combined current account, used by the IMF and other economists to gauge the spare cash investors have to plough into foreign assets, will narrow to 13 per cent of gross domestic product, or $180bn, from 20 per cent of GDP last year.
Saudi Arabia’s current account surplus will decline 28 per cent to about $70bn (€52bn, ￡35bn) from $96bn last year, the IMF forecast.
But despite the expected dip in surpluses this year, the cumulative current account surplus for the Middle East and Central Asia region remains high. Since 2003, it has grown to $810bn, with Gulf Arab states accounting for three-quarters of that amount.
These funds are ripe for recycling overseas, says Mohsin Khan, IMF Middle East and Central Asia department director.
"Since the regional stock market crash [last year], investors have looked to real estate and foreign assets," said Mr Khan in an interview. "They are also looking at assets around the region, going in a major way into Egypt, along with Jordan and North Africa."
The general outlook continued to be bright, the IMF said.
A combination of economic reforms, a favourable global environment and high oil prices produced real GDP growth across the region of 6.5 per cent last year, bringing up average per capita incomes 75 per cent higher than 2002, the first year of this petrodollar boom.
Economic growth in the Middle East and Central Asia is expected to remain at the same level this year as the oil-driven surge continues.
Emerging markets such as Egypt would continue to grow strongly, the IMF said. Post-conflict states such as Iraq, Afghanistan and Sudan should jump into double-digit growth on stronger institutions and steadier policies, providing security improved.