Robert Powell, Editor/Economist of the Economist Intelligence Unit (June 28th 2010)

1. The new normal Or, where the world goes from here Robert Powell Senior editor, MENA [email_address] Dubai June 2010

2. Where are we now?

4. Global: World trade bounces back World trade volumes. 2000=100. Seasonally adjusted. Source: CPB Netherlands Bureau for Economic Policy Analysis.

5. Financial markets: Fragile 3-month LIBOR/3-month overnight index swap (OIS) spread, percentage points. A higher spread denotes more market stress . Sources: Haver Analytics; Economist Intelligence Unit. Lehman fails Financial markets crash Fed introduces QE Euro zone woes spook markets

6. Policy: No Keynesian free lunch Gross public debt stock as a % of GDP. End-period. Source: Economist Intelligence Unit, CountryData .

7. The bad news

8. US: A recovery is under way … Jobs in ‘000s; unemployment, %. Source: Bureau of Labour Statistics.

9. … but housing is still sluggish US housing starts, ‘000s, SAAR. Source: Bureau of the Census.

11. The good news

12. Crises accelerate existing trends GDP, purchasing power parity (PPP) US$ bn. Source: Economist Intelligence Unit, CountryData .

16. The CIVETS: Six to watch for Forecasts are for 2010, as of June 2010. Source: Economist Intelligence Unit, CountryData . Population (m) GDP/head (US$, PPP) Inflation (%) Growth (%) C olombia 46.9 8,910 2.9 2.4 I ndonesia 243.0 4,240 5.1 5.6 V ietnam 87.8 3,140 10.5 6.2 E gypt 84.7 5,920 12.2 5.2 T urkey 73.3 12,750 10.1 4.8 S Africa 49.1 10,720 5.8 2.8

18. What this means

20. Where’s the growth? Real GDP growth; % change, year on year. ASEAN = Association of South East Asian Nations. CIS = Russia, Ukraine etc. As of April 2010. Source: Economist Intelligence Unit, CountryData .

21. The Middle East – after the windfall Sheikh Zayed Road -1990 Sheikh Zayed Road – 2007

23. OIL: short-term bear, long-term bull

24. Oil price outlook: Near term Oil price: US$/barrel; % change, year on year. Source: Economist Intelligence Unit, CountryData

25. But prices remains below 2008 highs a OECD stocks Source: Economist Intelligence Unit, CountryData EIU oil market outlook m barrels/day 2007 2008 2009 2010 2011 Total world oil production 85.1 86.3 84.8 86.5 88.4 Non OPEC 47.6 47.1 48.8 49.3 49.9 OPEC 35.4 36.6 33.4 34.4 35.7 Total world oil consumption 86.4 86.0 84.9 86.5 87.8 Stock change -1.3 0.3 -0.02 0.1 0.6 Brent dated price (US$/b) 72.7 97.7 61.9 80.2 78.5

28. All of which makes the Middle East more important!! Source: BP, Statistical Review of World Energy

29. ( and don’t forget the gas ….) Source: BP, Statistical Review of World Energy

30. Pushing on

31. Oil economies are in the black … Budget balance, % of GDP Bahrain, Iran, Kuwait, Oman, Qatar, Saudi Arabia, UAE, Yemen Source: Economist Intelligence Unit, MENA RO Country Forecast

32. … and looking good Sovereign wealth funds, % of GDP Sources: SWF Institute

34. and non-oil economies are in the red Budget DEFICITS, % of GDP Source: Economist Intelligence Unit. Egypt, Israel, Jordan, Lebanon, Morocco, Tunisia .

35. Lots done … Source: World Bank, Doing Business report 2010 .

36. … more to do ( Legal & regulatory risk) Source: Economist Intelligence Unit, Riskbriefing .

38. Ones to watch…

46. Where’s the growth? Real GDP growth; % change, year on year. Source: Economist Intelligence Unit, CountryData . 2009 = 9.5% 2010 = 23.3% 2011 = 12.7%

47. More Information? Data and analysis from today’s presentation were taken from the Economist Intelligence Unit’s country analysis and forecasting services. For more information on these services and other EIU capabilities, including risk assessment, industry trends, and economic data, please contact: Economist Intelligence Unit 2 Dubai Media City Tel: + 971 (0) 4 433 4202 Fax: + 971 (0) 4 438 0224