US President Donald Trump imposed 10% tariffs on Gulf Cooperation Council (GCC) countries in April this year. The GCC comprises mostly oil-rich nations such as Saudi Arabia, Qatar, the United Arab Emirates, Bahrain, Kuwait, and Oman. The Gulf nations have responded to US tariffs with trillion-dollar investments in their own countries.
The investment strategies are bold enough to reshape their traditional economies and usher in a new era. For instance, Gulf nations have been reducing dependency on oil to fund their economies. The trillion-dollar investments now flow into new sectors like tourism, digital innovation, financial services, and renewable energy. While the US is imposing tariffs, Gulf countries are strengthening their economies through major investments.
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Gulf Countries Walk An Independent Path Despite US Tariffs
Gulf countries now aim to attract foreign investments by opening up their economies to tourists and businesses. The sweeping infrastructural projects have worked seemingly well as they chart a course towards long-term economic resilience. Despite US tariffs, Gulf countries have pledged to uplift their economies and not be bogged down by pressure from the White House.
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In addition, GCC countries have also invested in the US after the tariffs to keep their economy afloat. The White House revealed that $2 trillion worth of investments will come from the GCC members. Saudi Arabia’s $600 billion investment, $1.2 trillion investments from the UAE, $1.4 trillion from Qatar, among others. After protecting their economies, Gulf countries have also invested massively in the US in a win-win situation.
The World Bank has projected that Gulf countries will navigate the US tariffs successfully and expand their GDPs. The projection estimates that they would grow by 3.2% in 2025 and 4.50% in 2026. Saudi Arabia’s Vision 2030 could reshape the region, adding new tourist footfalls in the next decade. While reliance on oil dips, they are exposing their economies to newer sectors in the financial markets.