Wednesday, June 01, 2011

What's the Arab Spring costing the GCC?

Here's the bit most relevant to the UAE:
The revolutionary wave has largely spared the high-rent GCC monarchies with small national populations: Qatar, Kuwait and UAE. Pressures to throw around money have hence been less acute. The UAE government has nonetheless committed to spending $1.6 billion on infrastructure in the poorer and potentially restless northern emirates, raised military pensions by 70 percent and started subsidizing bread and rice.
In the wake of demonstrations and strikes in Bahrain and Oman, their richer GCC neighbors have recently promised 20 billion dollars to support development in the two countries -- a good share of which will have to be coughed up by Saudi Arabia. In the mid-term, relatively resource-poor Oman and Bahrain run the danger of becoming a fiscal ward of their better endowed neighbors. Bahrain's sovereign ratings have already been downgraded in March, while Oman is on review for potential downgrades.

Read the rest of The Cost of the Counter-Revolution in the GCC at Foreign Policy's Mideast Channel.

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