Oil exporting countries in the Middle East lost $390 billion in revenue due to lower oil prices last year, according to the International Monetary Fund. The IMF said on Monday that the region should brace for even deeper losses of more than $500 billion this year, Associated Press reported, citing a revised economic outlook report.
The fund had initally projected in October that oil exporting countries in the region would see revenue losses of $360 billion in 2015. AP quoted the IMF report as saying these countries will see revenues from oil exports drop even more in 2016, to between $490 billion to $540 billion compared to 2014. Masood Ahmed, IMF director for Middle East and Central Asia, said in comments quoted by AP that these losses translate into budget deficits and slower economic growth, particularly for countries like Saudi Arabia.
The report said that economic growth in the six Gulf Cooperation Council countries of Saudi Arabia, Kuwait, Qatar, Bahrain, Oman and the UAE will slow from 3.3 percent in 2015 to 1.8 percent this year.
"Oil prices are likely to improve from where they are, but they're not going to go back to the figures that we saw in 2013 and 2014 for a long, long time, so this means that many of them have to cut back spending and they also have to try to raise revenue outside the oil sector," Ahmed told The Associated Press.
The IMF warned that just among oil exporters in the region, 10 million young people are expected to enter the workforce by 2020, yet 3 million of them will find themselves without jobs at the current pace of development.