International Monetary Fund blames decline in oil prives for prediction of drop to 3.5%

GDP growth in the states that make up the Gulf Cooperation Council will fall by nearly half to 3.5% this year, the International Monetary Fund says.

The IMF said a decline in oil prices and production would reduce oil receipts for Middle East oil-exporting countries by half compared with last year. The lower prices would result in a drop of $300bn (£203m) in government revenue.

The director of the IMF's Middle East and Central Asia department, Masood Ahmed, said: “The global economy is going through its most serve economic crisis since the Great Depression.”

Recent forecasts for the UAE have seen predicted growth rates cut because of the decline in property prices, the shortage of funding and low oil prices.

Standard Chartered Bank cuts its GDP forecast this year from 2.7% to just 0.5% while the chief economist for the Government of Dubai said earlier this week the rate will slow from between 6% to 8% last year to between 2.5% and 3% this year.