British investigation: This is what the Gulf states are doing with the profits of the "enormous" oil

[size=35][size=35]British investigation: This is what the Gulf states are doing with the profits of the "enormous" oil boom.. What about Iraq?[/size]
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2023-04-11 | 04:38
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Alsumaria News - International

An investigation by The Economist magazine said that the Gulf countries, which benefited from the recent boom in oil production profits, are now recycling their profits in a new way, in light of their efforts to gain greater external influence.

The report stated that the Ukrainian war and the sanctions led to a rise in oil and gas prices, which means that oil exporters are drowning in money, as the surplus of countries in the Gulf Cooperation Council has reached: Kuwait and[You must be registered and logged in to see this link.]And the UAE and Saudi Arabia, as a result of the rise in prices to $ 350 billion in 2022, and even with the decline in prices compared to last year, it is expected that they will achieve $ 300 billion.
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The report indicates that instead of placing the huge oil profits, which were previously called "petrodollars" in the coffers of their central banks, these countries are now using

new For debt, the magazine indicates that due to the drop in oil prices between 2014 and 2016 and then during the Corona pandemic, the Gulf countries sold some foreign assets, and their central banks sold part of their stocks of foreign currencies. But this was not enough, so I also borrowed a lot of hard currency from Western capital markets.

Now, some petro-states are taking advantage of higher prices to shore up their balance sheets. Abu Dhabi, the richest emirate in the UAE,

has paid $3 billion since the end of 2021, about 7 percent of the total amount

owed .[You must be registered and logged in to see this link.]$4 billion of its debt, which represents about 4 percent of the debt

. The volume of indebtedness in Kuwait has halved since 2020.

Gulf countries help[You must be registered and logged in to see this link.], which received $13 billion in deposits from[You must be registered and logged in to see this link.]Saudi Arabia and the Emirates.

Saudi Arabia allowed However

, these funds are more conditional than they were in the past, in the interest of those countries to recover at least some of their money. Saudi Arabia recently asked[You must be registered and logged in to see this link.]Pakistan and implement economic reforms before giving them more aid.

What is new in this regard is Turkey, which in the past relied on international institutions to help it, then it needed the Gulf states. And the Kingdom had announced that it would deposit $ 5 billion in the country’s central bank, and established[You must be registered and logged in to see this link.]The UAE is a $19 billion currency swap with its central bank, according to Al-Hurra. The magazine

notes that Saudi Arabia and the UAE, which had a frosty relationship with Turkey until recently, are now competing to impose their influence on its president, Recep Tayyip Erdogan, Who faces difficult elections in May. The other

source is foreign investments through sovereign funds

. In previous periods of prosperity, the Gulf states reinvested the proceeds in Western capital markets, in order to obtain stable returns, often from Through ultra-safe government bonds.

There was an unspoken agreement that the United States would provide military aid and buy oil from Saudi Arabia and friends, in exchange for filling the huge deficit in the American current account with petrodollars.

Now, the Gulf states no longer feel that they are Forced to woo the White House.

And on the second of April, Saudi Arabia and its allies angered the West by announcing a further reduction in crude oil production to nearly 4 million barrels per day. The data obtained by the magazine

indicate countries have become dependent on managing their wealth in investment funds in a different way. "And it has become more adventurous and less focused on the West." The data

indicates that it is looking for less traditional assets, which take time to identify, and there is a decline in bond purchases in exchange for a significant increase in the purchase of stocks and high-risk assets. Countries are also

turning to "alternative assets", which are unconventional investments with high risk compared to regular assets. These investments, which include private equity, infrastructure and hedge funds, represent 23 to 37 percent of the total assets of the three largest funds in the Gulf, according to Global SWF Corporation.

"Direct" investments and acquisitions of stakes in listed companies are also growing rapidly. A European asset manager

says : "Unless we have something unusual, we are forbidden

to offer them anything." Gulf funds have specialized teams to study markets in China, India and Southeast Asia.

“This is where they will sell more oil, so they want to invest in industries that will use that oil,”

Whilesays others are withdrawing from China, fearing a clash with the United States, the Gulf states Its position there is strongly strengthening, according to a large investor who said: "Our Gulf clients see a huge opportunity to take space from Western investors."



One of these

goals[url=https://www.alsumaria.tv/Entity/24452494/%D8%B5%D9%86%D8%AF%D9%88%D9%82 %D8%A7%D9%84%D8%A7%D8%B3%D8%AA%D8%AB%D9%85%D8%A7%D8%B1%D8%A7%D8%AA %D8%A7%D9%84%D8%B9%D8%A7%D9%85%D8%A9/ar/]Public Investment Fund[/url]Saudi subsidiaries in[You must be registered and logged in to see this link.]And[You must be registered and logged in to see this link.]And Jordan, Bahrain, Oman and Sudan, to distribute $24 billion in Arab countries. The investigation did not touch much on[You must be registered and logged in to see this link.].

These countries are also gaining ground in "strategic" industries, such as renewable energy. Last

October, the UAE's sovereign wealth fund spent $2.5 billion on a German company to develop offshore wind power.

Last year, the American company “Lucid” for the manufacture of electric cars, of which the Saudi Fund owns about 61 percent, said that it would build its first foreign factory in Riyadh. The Saudi Fund

plans on sports competitions.[/size]
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