February 2009

A report by the Economist Intelligence Unit entitled “Global economic outlook 2009 – 2010” makes for alarming reading. Its conclusions are many including:

For the first time ever, all major economies in the Western world will report negative growth in 2009;

Trillions more dollars and euros in bank recapitalization and guarantees will be needed;

Zero interest rates and Keynesian public spending program are the only tools which can save the global economy;

There is still a 30% and growing chance that most of the global financial sector will be nationalized in 2009-2010.
And, citing Le Monde as its source, the report suggests that 12% of multimillionaires who are conducting an extra-marital affair are considering stopping the affair for financial reasons!

Link to the Original Article: http://www.global-economic-outlook-2009-2010-daniel-thorniley.com

As the oil wealth of the region has increased, investing in human capital and sustainable educational development has become more important than ever for the GCC countries. NCB Capital's report on 'Shaping the Future', calls for increased government spending directed at building education infrastructure and ensuring long-term development far beyond an oil-based strategy.

A strong causal connection between investment in education and economic growth has been established in research conducted around the world. However investment in education will not be enough as complementary growth-enhancing policies and frameworks will be necessary to reinforce the level of investment in quality education.
 
The education sector remains almost solely reliant upon public expenditure in the GCC. Saudi Arabia and Kuwait lead with c.6-7% of GDP invested into education. Other GCC countries lag with around 4% of GDP. New regulations are expected to ease the participation of the private sector. Nevertheless it is a big task when you consider that 38% of the Saudi population and 43% of the Omani population is under 14 years of age. Failure to transform this group into productive labor could be very dangerous and there is no history of success in this area. Even a country like Saudi Arabia has a long history of relatively high levels of unemployment and key sectors of the economy remain dependent on migrant workforce.

There is an opportunity for the private sector to enter niche market segments and introduce education platforms for the target population and to drive women into the workforce.

Source: Shaping the Future by NCB KSA