This report highlights the opportunities and challenges facing GCC countries trying to privatize SOEs. It describes the key success factors required to make privatizations effective in the region. Lastly, it argues that the potential benefits of privatization go beyond improving the fiscal balance of governments. If executed correctly, privatization can also contribute to the economic and social well-being of the region. As such, it should be seen as an integral part of the economic transformation plans of GCC countries.
In recent decades, both developed and emerging economies have reaped clear benefits from privatizing state owned enterprises (SOEs). While Gulf Cooperation Council (GCC) countries have been absent from this trend, large budget deficits due to recent oil price declines have made privatization a top priority for governments in the region.