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• No decline of GCC energy funds expected following US economic recession or fall in oil prices

 
Recent reports on the solar energy industry found that solar energy accounts for only one percent of the world’s energy resources, today, while the rise of energy prices to record highs, coupled with the lack of signs of stability, seems certain to increase investment in this sector by approximately 50 percent within two years.
 
The move towards sustainable and renewable energy sources is gaining momentum in GCC countries and throughout the world, as countries try to secure alternative energy resources to fuel other related projects, such as building water desalination plants and supplying power to developing areas. However, progress in carrying out these projects was hampered as fears arose regarding the risks of increased global economic instability.
 
Dr Abdullah Al Amiri, Chairman of the Emirates Energy Award, said, “The GCC countries have overcome the fears associated with any predictable decline of energy funds following the US economic recession, or a fall in oil prices. The theory that either of these two situations would have a negative effect of the GCC countries has proved to be incorrect, as several current findings seem to indicate the contrary. The US mortgage market woes did not spread to the GCC markets, while the fuel prices are still soaring on the global markets. The high amount of liquidity injected into the region will secure the market against any slump. The foreign reserves available in the market, estimated at $455 billion in 2008, up from $365 billion in 2007, will further defend the market against any fall.”
 
In light of these encouraging initial results and successful experiments, GCC countries can safely invest in the energy sector as there is an increasing global trend to raise investment to cover the $40 billion required in the petrochemical sector by 2010. GCC petrochemical production contributed seven percent to the world’s total production.
 
GCC countries are to invest $160-200 billion in between 14 and 20 energy projects. The growth of the six countries is expected to remain within the world growth rate, due to the $132 billion current account surplus, and they have already start playing an increasingly major role as exporters of capital for emerging countries – estimated at $30 billion, according to the latest report on world growth issued by the International Bank – with more investment to be pumped into the region from the GCC countries.
 

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