GCC still lagging when it comes to converting wealth to well-being

23 September 2019 Consultancy-me.com

Boston Consulting Group has highlighted the global standing of the GCC in a number of dimensions on its latest Sustainable Economic Development rankings, but converting wealth to well-being remains a challenge throughout the region. 

Performed annually since 2012 as a relative measure of national wealth to citizen well-being, the latest Sustainable Economic Development Assessment (SEDA) rankings from global strategy and management firm Boston Consulting Group have seen the countries of the GCC emerge as world-leaders in several key dimensions, most notably in terms of income. The analysis covers 143 countries worldwide, representing over 97 percent of the world’s economy and population.

Taking into account 40 indicators across ten dimensions, divided into the broader categories of ‘economics’ (income, employment, economic sustainability), ‘investments’ (health, education, infrastructure) and ‘sustainability’ (environment, governance, civil society, and income equality), the analysis places all six members of the GCC within the top 50 countries worldwide for overall SEDA rankings, ranging from the UAE at 28th globally down to Saudi Arabia at 47th.

BCG Sustainable Economic Development Assessment dimensions

In terms of income however, as a measure of GDP per capita, the majority of GCC nations are bunched at the top, with Qatar scoring a perfect 100 to head the global table and the UAE and Kuwait following closely behind with scores of above 96. The region has also made significant improvements over the past twelve years in respect to employment, education and infrastructure, although has lagged the rest of the world for progress in the SEDA sustainability bracket.

“The GCC has enhanced its SEDA scores through the advancement of several key dimensions. This reflects a promising shift towards converting prosperity into well-being that benefits all,” said Dubai-based BCG Middle East Managing Director Leila Hoteit. “Overall, governments of the GCC states can proffer from placing emphasis on improving more well-being dimensions to raise the standard of living as well as instil economic resilience in the years ahead.”

Country income levels compared to well-being

Yet, despite strong scores for income across the GCC states, when it comes to the wealth to well-being co-efficient, which measures the level of a nation’s well-being across categories against gross national income per capita – 1.0 being the baseline score for what would be expected – the GCC in general is still underperforming in converting its wealth, with Oman the only member above the baseline, at 1.08. Qatar sits at 0.82, above only Iraq and Yemen in the Middle East.

Qatar has however improved its wealth to well-being co-efficient score since 2008’s low of 0.79, with the report labelling the nation’s overall well-being performance as ‘good and improving’. According to the BCG analysts, Qatar could further enhance its overall well-being performance through greater attention and intensified investment into education, economic stability and the environment, areas in which the gas-rich country still trails behind its global peers.

“We believe that sustainable economic growth and improved well-being should be correlating aspects of any future-facing national agenda,” concluded BCG Middle East Managing Director Alexander Tuerpitz. “Through the analysis of twelve years of SEDA scores, turning prosperity into citizen wellbeing is proving to be an effective motivation for leading governments to lift the quality of life for citizens and pave a way forward for both social and economic futures.”