Gulf countries have improved their Competitive Industrial Performance Index (CIP) rankings released by the United Nations Industrial Development Organization (UNIDO), according to the National Bank of Kuwait (NBK). 

 

The UAE ranked first in the Arab region and 29th globally compared to 31st in 2020, followed by Saudi (35th from 42nd), Oman (56th from 58th), and Kuwait (62nd from 67th), while Qatar (50th) and Bahrain (51st) were unchanged. 

 

The higher rankings were mainly attributed to the rise in manufacturing value added and export-per-capita indices. The CIP ranks 153 countries, assessing the national industrial performance through benchmarking countries’ ability to produce and export competitively through technological capabilities, innovation, productivity and trade performance indicators.

 

Saudi Arabia

Meanwhile, Saudi Arabia’s oil exports were down in May. Oil exports stood at 6.93 mbpd in May, down by 5.3% m/m and 1.7% y/y, NBK said. 

 

For the first five months of 2023, oil exports are still up by 2.5% y/y given relatively high levels in Q1. 

 

Nevertheless, oil exports will be under further pressure given the country’s additional 1mbpd voluntary cut to oil production, at least for the months of July and August. 

 

From January through August, oil production would have decreased by an estimated 5% y/y and will likely continue to be lower on a Y-o-Y basis in the remainder of the year, putting pressure on overall GDP growth after that was a solid 8.7% in 2022.

 

Oman

Bank credit growth has edged up in Oman. Domestic credit increased by 6.4% y/y in May, slightly higher than April’s reading of 6.3%, driven by faster growth in private sector credit of 7.4%, according to the latest central bank data. Meanwhile, total bank deposit growth also picked up to 5.9% from 5.5% in April and from a low of 1.1% in December last year. 

 

Growth in time deposits (7.8%) is outpacing that in savings (-1.2%) and demand (4.5%) deposits, linked to the higher interest rate environment.

 

Bahrain

Bahrain’s GDP growth has moderated in Q1. GDP growth moderated to 2% y/y in 1Q23 from 4.1% in 4Q22, weighed mostly by a decline in oil GDP (-5.9% y/y) amid seasonal oilfield maintenance, while the non-oil sector grew by a still-solid 3.5% (4.9% in 4Q22) on a pickup in tourism, real estate, and financial sector activities. 

 

Softer growth readings are likely to continue this year (economy grew a robust 4.9% in 2022), reflecting a more challenging macroeconomic backdrop amid higher interest rates and lower oil prices.-- TradeArabia News Service