HSBC on Monday reiterated its confidence in the economic outlook for countries in the Gulf, stressing that the bank's view of the region's underlying strengths has not changed amid recent conflict-related disruption.
In a statement, CEO Georges Elhedery said: "HSBC remains steadfast in our confidence in the GCC and in the long-term strength, resilience and promise of the region. Our conviction in the GCC’s fundamentals and its future is unchanged," reaffirming the bank's commitment to the region's prospects.
The Gulf Cooperation Council, which the bank specifically referenced, is composed of six nations: Bahrain, Kuwait, Saudi Arabia, Qatar, Oman and the United Arab Emirates. These states derive a significant portion of public revenue from the export of oil and gas, sectors that have been affected by recent military actions.
The statement comes amid a period of heightened activity related to the U.S.-Israeli war with Iran. Since the start of that conflict 10 days ago, Iranian drones and ballistic missiles have struck targets across the GCC, producing disruptions to oil and gas exports that underpin regional government revenue and trade flows.
Elhedery reiterated that despite the short-term turbulence, HSBC expects the region to return to a path of stability, growth and prosperity over the coming years. The bank's message emphasizes confidence in the region's long-term fundamentals rather than minimizing the near-term operational impacts caused by security events.
Summary
HSBC maintains a positive long-term view of the GCC economies and says its conviction in the region's fundamentals remains unchanged, even as recent drone and missile strikes originating from Iran have disrupted oil and gas exports across the Gulf.
- Key points:
- HSBC publicly reaffirmed faith in the Gulf's economic resilience and long-term prospects.
- The GCC comprises Bahrain, Kuwait, Saudi Arabia, Qatar, Oman and the UAE.
- Recent Iranian drone and ballistic missile strikes have interrupted oil and gas exports that support regional revenue.
- Risks and uncertainties:
- Ongoing security incidents have already disrupted hydrocarbon exports, posing near-term revenue risks to Gulf states - energy and sovereign revenue sectors are affected.
- Further conflict-related strikes could prolong disruptions to trade and exports, maintaining pressure on regional logistics and energy markets.