São Paulo – Saudi Arabia is in the first place among the Gulf Cooperation Council (GCC) countries with regards to assets in sovereign funds, according to an article published on Tuesday (13) by Arab News newspaper, of Riyadh. The figures are included in a report disclosed by ratings agency Moody’s. The GCC is made up of Saudi Arabia, Bahrain, Qatar, the United Arab Emirates, Kuwait and Oman.

Assets of sovereign funds total US$ 641 billion. Then come the institutions from the Emirates, with US$ 397 billion, Kuwait (US$ 395 billion), Qatar (US$ 175 billion), Oman (US$ 14 billion) and Bahrain (US$ 11 billion).

According to the paper, the assets of the GCCs sovereign funds totalled US$ 1.6 trillion in late 2012, equivalent to 107% of the aggregate Gross Domestic Product (GDP) of the bloc. In 2007, the assets were US$ 1 trillion, or 105% of the regional GDP. Arab News informs, based on a Moody’s study, that the value rose in 2009, accompanying the recovery of oil prices.

The report adds, according to the paper, that the appreciation of the commodity over the last two years resulted in unprecedented accumulation of riches in the countries of the bloc. With this, the government of the region expanded spending with infrastructure and with the concession of benefits to the local populations. In the period, the barrel of oil was quoted at US$ 110 on average, double the value observed from 2001 to 2010.

The accumulated result for international reserves and assets in the hands of sovereign funds may alleviate a possible economic shock in the region due to a sudden drop in oil prices. The GCC answers to 24.3% of global production of the commodity and for 11% of the gas offer, with funds in the bloc concentrating 32.6% of assets of this kind of institution worldwide.

*Translated by Mark Ament