The Institute of International Finance projected non-resident capital inflows to Gulf Cooperation Council (GCC) countries to reach $147.5bn in 2019, constituting an increase of 14.8%, or of $20bn, from $128.5bn in 2018, mainly driven by a rise in portfolio investments. It projected portfolio investment inflows to GCC economies to increase from $55.3bn in 2018 to $80.2bn in 2019, with equity inflows expanding by 3.5 times to $16bn and debt flows rising by 26.6% to $64.2bn this year. It attributed the anticipated increase in portfolio debt inflows to the inclusion of five GCC economies in J.P. Morgan's emerging-markets bond index in January 2019, while it noted that the admission of Saudi Arabia's stock market to the FTSE on March 2019, and its expected inclusion in the MSCI EM Index in May, would raise equity inflows. It added that Saudi Arabia and Qatar issued a combined $19.5bn in sovereign debt in the first quarter of 2019. 

Further, the IIF forecast foreign direct investment inflows to the GCC region at $20.2bn in 2019, which would constitute an increase of 17.5% from $17.2bn in 2018. It projected resident capital outflows from the GCC region to decrease from $256.8bn in 2018 to $234.4bn in 2019, but to exceed non-resident capital inflows. 

In parallel, the IIF forecast total non-resident capital inflows to non-GCC oil-exporting economies in the Middle East & North Africa region, which include Algeria, Iran, and Iraq, at $16.6bn in 2019, and to grow by 56.6% from $10.6bn in 2018. It also anticipated capital inflows to Iraq, which consist of concessional loans to rebuild the country's infrastructure, to represent 50% of aggregate inflows to non-GCC oil-exporters in 2019. In parallel, it forecast resident capital outflows from non-GCC oil-exporting economies at $10.9bn in 2019, which would constitute a decline of 55.5% from $24.5bn in 2018. 
Source: Institute of International Finance