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Mohamed Z. Bechri is former economics professor at the University of Sousse in Tunisia. He served as principal economist at the Central Bank of the U.A.E. from 2001 to 2022, where he was the lead author of “The U.A.E. MSMEs Business Survey Reports” for 2019 and 2020. He was also an economist at the IMF’s African Department in 1993-95. His main research focus is on monetary policy, institutions, and development. Bechri holds a doctorate in monetary economics from La Sorbonne University in Paris and a PhD in economics from the University of Southern California in the U.S.
Gulf economies should use the available fiscal space to ensure a soft landing
After achieving respectable growth in 2021, the GCC member states now face the risk of monetary (over) tightening due to the need to follow the U.S Federal Reserve’s interest rate adjustments. These increases are not warranted, however, as the GCC economies currently face relatively moderate inflation. Instead, they should use the available fiscal space to mitigate the negative fallout of monetary tightening and make greater use of PPPs for future infrastructure development.
