The G20 said everything and committed to nothing. The Gulf should pay attention

The G20 finance ministers convened in Asheville without a joint communique, leaving the US host to issue a statement representing the 19 other members. US Treasury Secretary Scott Bessent identified barriers to growth, including excessive regulation, poorly designed tax systems, inadequate investment, fragmented markets, and skill gaps.

He advocated for tax certainty, energy certainty, and regulatory certainty. The Gulf, with its diversification strategy, relies on these foundations. However, the implications of the US framework remain uncertain for the UAE, Riyadh, and the wider Gulf Co-operation Council. On Iran, the US has adopted "financial violence" as policy language, with plans to impose sanctions on another bank this week.

The Banque Misr action tests the exclusion of UAE branches of a third-country bank due to Iranian exposure. Private-sector executives, for the first time, participated in discussions alongside finance ministers, highlighting challenges like regulatory fragmentation, tariff uncertainty, volatile energy costs, and sovereign debt crowding out private capital.

These issues mirror the Gulf's investment environment. The Asheville meeting exposed limits in sanctioning Iran and China. China declined to endorse the US position, which could complicate the September G20 meeting and highlight the divide between the US and China on international financial system rules. Russia's attendance was its first since the invasion of Ukraine in 2022, adding another layer of complexity to the geopolitical landscape.