The Gulf Cooperation Council (GCC) states are set to spend US $700 billion on modernising infrastructure and social services between now and 2010, the Federation of the GCC Chambers (FGCCC) said in its latest report.
The UAE and Qatar in particular are ploughing billions of dollars into infrastructure projects, with the bulk going towards road and bridge works and utilities projects.
The report also said that the rise in oil revenues has increased both public spending and the volume of imports.
"Imports of the GCC states have jumped from $330.5 billion to $409.4 billion," the report said.
The report added inflation is the key problem in the region. The projects under progress across the GCC states are worth around $2 trillion, but many are at risk because of rising costs.
Salah Al Shamsi, the former chairman of FGCCC and chairman of the Federation of UAE Chambers of Commerce, described inter-GCC trade and investment as ‘very low'.
Trade between the GCC states does not currently exceed 9%, while investment is only 7%.
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