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South Korea Launches Council on Economic Cooperation with Middle East

South Korea launches council on economic cooperation with Middle East. (Reuters)
South Korea launches council on economic cooperation with Middle East. (Reuters)
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South Korea Launches Council on Economic Cooperation with Middle East

South Korea launches council on economic cooperation with Middle East. (Reuters)
South Korea launches council on economic cooperation with Middle East. (Reuters)

South Korea on Friday launched a council involving both government and private sectors meant to jointly seek ways to promote corporate advancement into the Middle East, the industry ministry said.

The council on the Korea-Middle East economic and trade cooperation will discuss how to actively participate in various projects by Korean firms in the region and boost cooperation with the countries there in energy and new industry sectors, according to the Ministry of Trade, Industry and Energy.

The government plans to send a delegation to the Middle East this year for talks on bilateral trade and investment based on the results of council discussions, it added.

"It is needed to enhance economic ties with the Middle East as a way to prop up our dwindling exports amid the prolonged war surrounding Ukraine and global supply chain disruptions," Deputy Trade Minister Jeong Dae-jin said.

In August, South Korea's exports rose 6.6 percent on-year and sales in the Middle East combined grew 7.8 percent on-year to $1.34 billion. But high global energy prices caused the country to suffer a record high monthly trade deficit of $9.47 billion, government data showed.

This was the first time in 14 years that the nation suffered a trade deficit for five consecutive months, dating to the period of December 2007 to April 2008.

According to the Ministry of Trade, Industry and Energy, the nation’s imports increased by 28.2 percent on-year to $66.15 billion in August, while exports increased to $56.67 billion.

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Public Finance of GCC Countries Witnesses Significant Financial Surplus

The Statistical Center for the Cooperation Council for the Arab Countries of the Gulf (GCC-Stat) logo
The Statistical Center for the Cooperation Council for the Arab Countries of the Gulf (GCC-Stat) logo
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Public Finance of GCC Countries Witnesses Significant Financial Surplus

The Statistical Center for the Cooperation Council for the Arab Countries of the Gulf (GCC-Stat) logo
The Statistical Center for the Cooperation Council for the Arab Countries of the Gulf (GCC-Stat) logo

Data issued by the Statistical Center for the Cooperation Council for the Arab Countries of the Gulf (GCC-Stat) indicate that the financial risks of the GCC countries will be low in the short term amid forecasts of stable or declining interest rates locally and globally.

The reports issued by Credit rating agencies also signaled an improvement in the sovereign bond rating of the GCC countries in 2023. It is also expected that the credit attractiveness of GCC countries will increase, which would allow for the rescheduling of their public debts at lower financial costs.

According to the estimates of the GCC-Stat, the public debt of the GCC countries is expected to stabilize at 28% of the GCC countries’ GDP during the years 2024 and 2025. The financial budget reform plans, which are based on improving the efficiency of public spending and programs to stimulate growth in non-oil sectors, would contribute to achieving a balance between maintaining the economic growth rate and the sustainability of public spending.

The data issued by the GCC-Stat also reveal that the public debt of the GCC countries has doubled over the past ten years to reach about $628 billion in 2023, after it was $144 billion in 2014. The volume of debt as a percentage of the GCC Countries’ GDP increased to reach its peak in 2020 at 40.3%, before declining in the following years to reach about 29.8% in 2023.

The total public finances in the GCC countries also recorded a significant deficit during 2014-2021. The highest deficit value was registered in 2015, with an amount of about $158 billion, which accounts for 11.1% of the total GCC Countries’ GDP. In 2020, a deficit of $128 billion was recorded, which represents 8.8% of the total GDP.

The public finances of the GCC countries witnessed a significant financial surplus in 2022 estimated at $134 billion, representing 6.1% of the gross domestic product, followed by a surplus of $2 billion in 2023.

The total public revenues in the GCC developed significantly during the period 2021-2023 to record about $641 billion in 2023. Oil revenues accounted for 62% of public revenues, compared to $723 billion in 2022, of which oil revenues accounted for 67%.

Total public spending in the GCC countries reached its highest levels in 2023, recording about $639 billion. Current spending accounted for 85% of the total public spending, compared to 15% for investment spending in the GCC countries.