Gulf states prepare aid fund for Oman and Bahrain

Reuters News
Posted: Mar 21, 2011 9:39 AM

DUBAI (Reuters) - Gulf Arab oil producers were due Thursday to discuss an aid fund for Bahrain and Oman, both of which are facing anti-government protests inspired by uprisings across the Arab world, Gulf government officials said.

Various local media have put the likely size of the fund at between $10 billion and $15 billion.

Foreign ministers from the Gulf Cooperation Council, which comprises Bahrain, Oman, Kuwait, Qatar, Saudi Arabia and the United Arab Emirates, were due to meet later Thursday in Riyadh, Saudi Arabia, where they were expected to discuss the fund, officials from the UAE and Bahrain told Reuters.

The package will likely be used to generate jobs for the young, who complain that their governments shut them out from opportunities and a say in government.

A Bahraini official confirmed last week that discussions for such a fund were taking place, but since then few details have emerged. Central bankers at the GCC meeting in Abu Dhabi on Thursday were also tight-lipped.

Worried about spreading rebellions, Saudi Arabia and the UAE are planning to spend billions of dollars to improve the living standards of poorer citizens.

Bahrain and Oman are small non-OPEC oil producers and need higher oil prices than oil giants such as Saudi Arabia or the UAE to replenish their government finances.

Kuwait, Bahrain and Oman have allocated new funds, grants and social benefits or promised new jobs and raised wages.

(Reporting by Reed Stevenson; Editing by Kevin Liffey)