Jim O’Neill’s travels recently brought him to the Gulf.From his latest Viewpoints:
I spent three days in different GCC countries earlier this week, culminating with participation in a MENA conference we hosted in Dubai. It was all quite fascinating, and I returned with about 5 main views:
- I am not convinced of any major structural trends in the region economically, although the scale of social winds blowing around the region are so strong, I still suspect it is quite feasible that big changes are coming sometime. It is just that most leaders there don’t realise it yet.
- I can’t see the logic for all this belief that an early attack on Iran is likely. Nothing I heard suggested otherwise. It certainly doesn’t make sense for the current White House, and from little intelligence I focus on, it is far from clear that Israel would get much from a move in its own right.
- As much as Dubai has its own challenges, as I have thought on past trips, it really can be increasingly seen as a sort of “N11” capital of the world, with many a diverse nations being highly relevant for its ongoing prosperity or otherwise. This includes Egypt, Iran, Pakistan, Turkey, and perhaps increasingly Africa, as well as a couple of the BRIC guys, notably India and Russia. It has its own unique rhythms related to all of this.
- As mentioned, Africa appears to be of rising relevance to Dubai. Or perhaps stated differently, it is becoming increasingly relevant to us all, it is just easier to notice it there. I had the pleasure of interviewing Bola Adesola, the CEO of Standard Chartered Bank, Nigeria at the conference, and I continue to think that despite their challenges, this is an enormously exciting place to focus on. In this regard, the UK Sunday Times magazine had an excellent focus on Africa last weekend, as did Hugo Scott Gall in his GS “Fortnightly Thoughts” this past week. One thing I picked up on in particular from Bola is that she said – in contrast to a number of others – that Nigeria has assumed a lower oil price, $70 per barrel as a budget price for this year, down from $ 75. This is the sort of wise thing needed to avoid the full blown impact of “Dutch Disease” problems associated with rising commodity wealth.
- I don’t get the logic of a GCC single currency. I never really did even without the example of the challenges facing the EMU. They don’t really even trade much with each other, never mind anything else. (Mind you as I have highlighted, the same is becoming true for some rather key Euro Area countries such as Germany).