The aggregate GCC central government deficit to fall sharply to about $80 billion in 2021 (5% of GDP) from $143 billion in 2020 (10% of GDP), said S&P Global Ratings in a new report.

"Lower deficits will be supported by higher oil prices, fiscal consolidation measures, and a higher level of economic activity as Covid-19 restrictions are lifted," said S&P Global Ratings Credit Analyst Trevor Cullinan.

“Nevertheless, we think still-high GCC central government deficits will result in continued balance sheet deterioration in most cases.

"That said, GCC sovereigns have demonstrated ready access to international capital markets and many have substantial pools of external liquid assets available to fund their fiscal deficits and support their economies in the face of external shocks," Cullinan concluded. – TradeArabia News Service

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