The Gulf: Absorption for What?

  • Rodney Wilson


Kuwait, Qatar, Bahrain and the United Arab Emirates have experienced during the last two decades one of the most rapid economic transformations the world has ever seen. The oil bonanza has resulted in their becoming affluent consumer societies, able to purchase the most expensive and sophisticated material goods and services that the West has to offer. Their enormous purchasing power is illustrated by their per capita gross national product levels, those recorded in Kuwait and the UAE during 1976 being $15,480 and $13,990 respectively, well in excess of the level of even the United States, which stood at $7890. As Qatar’s GNP per capita is $14,400, these three Gulf states constitute the richest countries in the world, if GNP is taken as a reliable measure of material wellbeing. Only Bahrain, which unlike the others is not a major producer of crude oil, has a more modest per capita GNP, estimated at $2410, but using this criterion of development, even Bahrain must be categorised with the developed countries rather than as a Third World nation.1


Indian Ocean Middle East Natural Gasoline Gulf State Territorial Area 
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  1. 2.
    For a description of the first years of oil in Kuwait see Violet Dickson, Forty Years in Kuwait (Allen & Unwin, 1970) Chapters 6 and 7, p. 144 ff. A brief assessment of oil’s economic impact is given in the IBRD report on The Economic Development of Kuwait (Baltimore: John Hopkins Press, 1965) pp. 53–6.Google Scholar
  2. 4.
    For a historical account of oil development in the emirates see K. G. Fenelon, The United Arab Emirates: An Economic and Social Survey (Longman, 1973) Chapter 5, pp. 32–43.Google Scholar
  3. 5.
    There is little economic literature exclusively devoted to Qatar. For a brief account of its oil industry see Peter Kilner and Jonathan Wallace (ed.), The Gulf Hand-book 1976/77 (Bath: Trade and Travel Publications, and London: Middle East Economic Digest, 1976) pp. 399–401.Google Scholar
  4. 6.
    Ralph Shaw, Kuwait (Macmillan, 1976) p. 37.Google Scholar
  5. 7.
    Fenelon, op. cit., p. 56. See also Donald Hawley, The Trucial States (Allen & Unwin, 1970) pp. 195–7.Google Scholar
  6. 9.
    H. V. F. Winstone and Zahra Freeth, Kuwait: Prospect and Reality (Allen & Unwin, 1972) p. 90;Google Scholar
  7. Michael Tomkinson The United Arab Emirates (Michael Tomkinson, 1975) p. 29.Google Scholar
  8. 11.
    Saad Andari, Kuwait: Development of a Mini Economy, M.A. thesis, University of Durham (1976) Chapter 3, p. 39 ff., discusses foreign trade dependence and the question of instability of export earnings.Google Scholar
  9. 12.
    For a brief review of the absorptive capacities in the Gulf see Yusuf J. Ahmad, Oil Revenues in the Gulf: A Preliminary Estimate of Absorptive Capacity: (OECD, Paris, 1974): Kuwait is discussed on pp. 50–69; the UAE on pp. 70–92; Bahrain on pp. 93–101; and Qatar on pp. 102–10.Google Scholar
  10. 25.
    Colin Chapman, ‘Industrial Progress — Fast and Visible’, The Emirates No. 6 (London: U.A.E. Embassy, December 1976) p. 8.Google Scholar
  11. 30.
    For an appraisal of this, see Ragaei H. Mallakh, Economic Development and Regional Co-operation: Kuwait (University of Chicago Press, 1968) Chapter 5, p. 133 ff.Google Scholar
  12. 31.
    I.M.F. International Financial Statistics, vol. XXX, no. 5 (May 1977).Google Scholar
  13. 34.
    For a summary of banking operations in the UAE see Nicholas Fallon, Middle East Oil Money and its Future Expenditure (Graham & Trotman, 1975) pp. 79–81.Google Scholar
  14. 35.
    The only published study on the economic impact of this migration is A. M. Farrog, ‘Migration between Arab Countries’, in I.L.O. Manpower and Employment in Arab Countries: Some Critical Issues (Geneva, 1976) pp. 84–108.Google Scholar
  15. 37.
    Galal A. Amin, The Modernization of Poverty: A Study in the Political Economy of Economic Growth in Nine Arab Countries 1945–1970 (Leiden: Brill, 1974) p. 83.Google Scholar
  16. 38.
    Kuwait Ministry of Planning Central Statistical Office, Annual Statistical Abstract (1976) Table 140, p. 190.Google Scholar

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© Rodney Wilson 1979

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  • Rodney Wilson

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