The Investment Studies Center (ISC) at Union of Investment Companies (UIC) in collaboration Quorum Centre for Strategic Studies in London held a talk on ‘The Global Financial and Economic Outlook for 2019.’ On Monday 11th February 2019 at Bahra Hall located in Kuwait Chamber of Commerce & Industry Building, where ISC hosted Mr. Tariq Al-Rifai, CEO of Quorum Centre for Strategic Studies in London to deliver the talk.
Ms. Fadwa Darwish, ISC Acting Director & Director of Technical Support at UIC introduced the event, clarifying that the Kuwaiti economy will be affected with the changes of the global economy, so ISC organized this seminar to shed the light on the latest international developments.
Mr. Al-Rifai gave an overview of the current state of the global economy, highlighting the current problems facing the major economies in Europe, the US and China. He also discussed the current economic growth cycle, which he strongly believes is nearing an end. Mr. Al-Rifai presented his case for why he believes the global economy is heading for another global recession.
According to already published statistics, economic growth in Europe is declining, including in its largest economies of Germany and France. Italy, is already in a recession and the UK’s central bank, the Bank of England, recently lowered its economic growth forecast for the UK citing Brexit, the trade war and other global economic problems as the reason for this negative outlook.
As the trade war between the US and China continues, it is beginning to impact global trade and economic growth, especially in China. Mr. Al-Rifai believes that China’s already declining economic growth figures will only get worse as the trade war enters its second year.
These problems alone are expected to weigh in on global economic growth. The International Monetary Fund (IMF) expects 2019 to experience lower economic growth due to these rising factors and risks. What does this mean for Kuwait’s economy? Mr. Al-Rifai establishes a link between global economic growth and oil prices. He shows how lower economic growth globally, means lower oil prices. Thus, as the world economy heads into its first recession since 2009, we can expect to see lower oil prices in the future. This would mean more pressure on Kuwait’s government to ensure it carries out its Future Vision 2035 plan. This plan is aimed at diversifying the economy away from its dependence on oil revenues.
Tariq Al-Rifai, concludes by giving his outlook on Kuwait’s national economy in light of the economic developments globally. He said that Kuwait must prepare for a world less dependent on oil because the next 10 years will be nothing like the past 10 years.