The customs duties imposed by the administration of US President Donald Trump have sparked a wave of anxiety among Gulf investors on the implications of these fees on the economies and markets of the Gulf and the Middle East, in light of the strong interdependence with global markets.
Many Gulf countries are exporting products to the United States such as aluminum and iron, which makes these exports vulnerable to restrictions, which may affect their revenues and the growth of their transformational industries.
Also, any slowdown in the global economy due to these fees may lead to a decrease in demand for oil, which constitutes additional pressure on the budgets of oil -producing countries in the region, according to observers.
Washington imposed unified customs duties of 10% on various Gulf countries.
Money and currency markets
Financial expert and market analyst Ahmed Aqel says that the imposition of American customs duties will have direct and indirect effects on the Gulf economy, especially on the financial and currency markets.
Aqel explained – in his interview with Al -Jazeera Net – that the Gulf currencies are closely linked to the US dollar, which means that any fluctuations in the value of the American currency will directly affect the strength of these currencies.
Akl expected that the dollar will witness a decline in its value during the coming period if the customs war continues, which would raise the cost of American exports to the Gulf, and result in additional burdens on smartphones, cars, and electronic devices.
The dollar continued to decline on Friday to reach its lowest level against the euro for more than 3 years.
The US currency fell 1.6% against the unified European currency to $ 1.1383 for the euro, after it had reached $ 1.1416 during the same session, its lowest level since February 2022.
On Friday, the dollar against the Swiss franc reserved its lowest level in 10 years due to the decline in confidence in the American economy.
Akl expects the global market to witness a decrease in demand for oil, which may lead to a decrease in its prices more than the current prices that have suffered from a major collapse.
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The stagnation of Gulf stocks
Regarding the Gulf financial markets, Aqel said that there is a remarkable stagnation in the movement of stocks in the region at the present time, explaining that the leadership companies in the Gulf stock exchanges will be the most at risk due to these changes, especially in sectors that depend largely on oil or products related to the dollar.
Akl expected that the profits of oil companies, especially petrochemical, would be greatly affected if the oil demand continues to decline.
Despite the great pressures that the Gulf financial markets may face, Akl indicated an opportunity for Gulf investors to benefit from the collapse of global stocks and their purchase at low prices, which may achieve great returns in the future when the global economic conditions improve.
The price of Brent crude decreased to below $ 60 a barrel this week, recording its lowest level since February 2021.
On Friday, oil prices stabilized at about $ 63.3 a barrel, but they are heading to incur the second weekly loss in a row, in light of investor fears of the escalation of the trade war between the United States and China.
It is expected that the two voices decrease 3.5% and 3.0%, respectively, during the week, after each lost about 11% last week.
For his part, economic analyst Abdel Rahim Al -Hour confirmed that the Gulf markets have already witnessed a remarkable decline in stock indicators during the days that followed the announcement of US President Donald Trump to impose customs duties on dozens of countries.
He explained that this decline was directly linked to the state of anxiety in the global markets, especially with the low oil prices, which is the main driver of the Gulf economies.
Al -Hour pointed out – in his interview with Al -Jazeera Net – that the daily losses in some Gulf markets due to the customs tariff were estimated at billions of dollars, explaining that these losses are very similar to what happened in the global economic crisis in 2008.
Most of the stock markets in the Gulf region fell on Wednesday with pressure from a global sale wave resulting from the latest escalation in the trade war between the United States and China, before returning yesterday after a day of the sudden step that Trump took by hanging most of the newly imposed customs duties.
Al -Hour said that commercial tensions usually lead to a high risk, which causes foreign investors to be reluctant to enter emerging markets such as the Gulf.
And that the Gulf markets have already recorded a decrease in capital flows at a time when some investors have tended to safer tools such as gold.
But Al -Hour pointed out that the Gulf economy has relative flexibility thanks to the financial surpluses, stressing that it needs to accelerate the economic diversification programs that have been worked on during the past decades.
Beijing supports Gulf capitals
For his part, the Chinese economic analyst specializing in Gulf affairs, Nader Rong Huan, expressed his belief that the customs tariff imposed by Trump will push the Gulf states to enhance economic dealings with China.
Huan explained – in his interview with Al -Jazeera Net – that China will be an important strategic partner for Gulf capitals, and will contribute to reducing the losses caused by American customs duties, by providing competitive prices for commodities.
He said that China would seek to strengthen its commercial ties with the Gulf at a time when the global economy suffers from the impacts of the trade war.
American Gulf understandings
As for Dr. Ed Burton, a professor of economics at the University of Virginia, he talked about the uncertainty that surrounds the world due to Trump’s customs decisions.
Burton explained – in his interview with Al -Jazeera Net – that Trump may succeed in strengthening the balance of the American treasury in many billions as a result of these tariffs, but this success may be temporary and at the expense of the United States relations with its European and Gulf allies.
The economy professor believes that – from an economic perspective – it was better to avoid imposing these customs duties on the Gulf states, which are an important commercial partner for the United States, especially in the fields of energy and investment.
However, Burton expected that there would be the possibility of important economic understandings between America and the Gulf states that may help reduce economic damage, especially in light of Washington’s awareness of the importance of the stability of the Gulf markets.
