How oil-rich Mideast countries are emerging as global economic centres

Oil-producing Middle East countries supply about 30 percent of global oil. PHOTO | POOL    

By GEORGE WACHIRA More by this Author

Oil-producing Middle East countries supply about 30 percent of global oil, a market share that has enabled the countries to accumulate massive revenue surpluses saved in sovereign wealth funds.

The United Arab Emirates (Dubai, Abu Dhabi), Qatar, Saudi Arabia, and recently Oman have embarked on specific plans and projects to transform their countries into major global economic players as they diversify away from oil-based economies.

Specifically, Dubai has already succeeded in creating first-class free trade zones, a concept the country adopted in the early 1980s, and which other regional oil neighbours are now adopting.

The urgency to transform Middle East oil economies is mounting as green transition away from oil to renewable energy gathers momentum. Major investments are taking place in liquefied natural gas (LNG), which is dubbed as the bridge fuel during the energy transition away from oil and coal. Also, investments in solar and wind energy, and hydrogen are fast growing.

The Middle East is also increasing its capacity in petrochemical manufacture in direct competition with China and India. The region is targeting a share of the global economic pie currently enjoyed by USA, Europe, and China.

This is an ambition supported by the Middle East strategic geographic location and its perceived geopolitical neutrality.

Qatar has particularly perfected its role as a political arbiter of choice in global conflicts. Of course, we have several Middle East oil-producing countries, such as Iran and Iraq, which are lagging in adopting transformational economic models.

Specific areas that the Middle East appears to be targeting are business, diplomatic and professional conferencing, global sports hosting, global financial and technology centres, and tourism. The Middle East countries listed above have progressive leadership and money to make it happen.

For Kenya, opportunities in the Middle East are many, with some of them already being actualised. Top on the list is the supply of skilled and semi-skilled labour and professional skills which Kenya is well placed to provide, and for which Kenya is already creating the necessary legal and institutional capacity.

The other glaring opportunity is exports of fresh agricultural produce and meat, including live animals, items of which all we need is to perfect quality management. Ready opportunities also exist in venture capital foreign direct investments (FDI) in various Kenyan projects.

To enable Kenya to maximise opportunities offered by the Middle Eastern countries, we need to ensure that our diplomatic missions there are staffed with the best business minds to deliver on these opportunities.

The writer is a petroleum consultant. wachira@petroleumfocus.com