The latest report by IMARC Group, titled “GCC Foreign Exchange Market: Industry Trends, Share, Size, Growth, Opportunity and Forecast 2024-2032“, The GCC foreign exchange market size is projected to exhibit a growth rate (CAGR) of 8.4% during 2024-2032.
Factors Affecting the Growth of the GCC Foreign Exchange Industry:
- Dependency on Oil Exports:
The GCC countries, including Saudi Arabia, the UAE, Qatar, Oman, Bahrain, and Kuwait, are major oil-producing nations. Oil exports constitute a significant portion of their GDP and government revenue. Consequently, the prices of oil and the demand for oil in global markets have a profound impact on the foreign exchange market in the GCC. Oil exports generate substantial revenue for GCC governments. These revenues are crucial for funding public infrastructure, services, and various government initiatives. The level of government spending and fiscal policies are often linked to oil prices.
- Economic Diversification:
Many GCC countries have recognized the need to diversify their economies away from a heavy reliance on oil exports. They are actively seeking to develop non-oil sectors such as tourism, technology, finance, and manufacturing. These diversification efforts aim to reduce the vulnerability of their economies to oil price fluctuations. To attract foreign investment in these non-oil sectors, GCC governments have implemented various policies and initiatives. These include offering incentives, simplifying business regulations, and improving the overall investment climate, which is propelling the market.
- Government Initiatives:
By establishing free zones, GCC governments create environments conducive to foreign investment. Businesses are drawn to these zones due to the favorable conditions, such as reduced bureaucracy, simplified import/export procedures, and tax benefits. Moreover, offering tax incentives makes GCC countries more competitive in the global market. Lower tax liabilities increase the profitability of businesses, making it attractive for both local and foreign investors to operate within the region. Consequently, initiatives like free zones and tax incentives provide transparency and regulatory stability. When investors have a clear understanding of the rules and benefits offered, they are more likely to commit capital to the region.
For an in-depth analysis, you can refer sample copy of the report: https://www.imarcgroup.com/gcc-foreign-exchange-market/requestsample
Report Segmentation:
The report has segmented the market into the following categories:
By Counterparty:
- Reporting Dealers
- Other Financial Institutions
- Non-financial Customers
Based on the counterparty, the market is divided into reporting dealers, other financial institutions, and non-financial customers.
By Type:
- Currency Swap
- Outright Forward and FX Swaps
- FX Options
Based on the type, the market has been classified into currency swap, outright forward and FX swaps, and FX options.
Breakup by Country:
- Saudi Arabia
- UAE
- Qatar
- Bahrain
- Kuwait
- Oman
On the basis of the country, the market is divided into Saudi Arabia, UAE, Qatar, Oman, Kuwait, and Bahrain.
GCC Foreign Exchange Market Opportunities:
The growing interest in Forex trading presents opportunities for financial institutions to offer currency trading services to retail and institutional clients in the GCC. Besides, by developing and offering Islamic-compliant Forex products, players are fulfilling the demand from investors seeking Shariah-compliant investment opportunities. These products adhere to Islamic principles of finance, such as avoiding interest-based transactions (Riba).
Moreover, Fintech companies in the GCC are leveraging technology to provide innovative Forex trading platforms and solutions. User-friendly mobile apps, AI-powered trading tools, and blockchain-based settlement systems are attracting tech-savvy traders.
Note: If you need specific information that is not currently within the scope of the report, we will provide it to you as a part of the customization.
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