Rasmala GCC Fixed Income Fund - Rasmala Investment Bank

GCC Market Outlook
• The Gulf Cooperation Council (GCC) has several of the
fastest growing economies in the world, primarily due to
a boom in oil and natural gas revenues.
• Oil prices have largely dictated the health of regional
economies however local governments are proactively
attempting to diversify their economies to reduce the
reliance on petrodollar inflows.
• The region is dominated economically by Saudi Arabia,
which generated approximately 47% of the GCC’s gross
domestic product in 2012, followed by the UAE with
23%, Qatar 12%, Kuwait 11%, Oman 5% and Bahrain
2%*.
• Oil price volatility and geopolitical tensions remain at
the forefront of investors’ minds.
• The GCC banking system currently shoulders a large
portion of the region's long term funding requirements
which is at odds with the short term liability profile of
their banks. This is being addressed through updated
financial regulation i.e. Basel III, and a greater
awareness of the liquidity risks inherent in running large
asset / liability mismatches.
• Growing demand for hotel space in the region (particularly
in the UAE), and the passing of the long awaited mortgage
law in Saudi Arabia, improve the outlook for the regional
real estate sector and are expected to pave the way for
increased construction spending and investment
opportunities.
The region has one of the world’s highest GDP per capita
*Source: Bloomberg; Rasmala Asset Management
Rasmala GCC Fixed Income Fund
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