IMF official: no need for GCC to cut spending much as oil falls

DUBAI: The oil price plunge is likely to have a significant impact on state revenues in the Gulf Cooperation Council, but GCC nations have big reserves so in general they will not need to cut state spending significantly, a senior International Monetary Fund official said on Tuesday.

Harald Finger, the IMF's head of mission for the United Arab Emirates, was speaking at a financial conference attended by senior UAE economic officials. As a matter of prudence, GCC countries should now rein in state spending, but they should do it in a gradual way to avoid hurting economic growth, Finger said. He also said the UAE might have to tap into its foreign assets if oil prices stayed at current levels or went lower.

Abu Dhabi's largest sovereign wealth fund is believed to have nearly $800 billion of assets.