DUBAI, Jan 17: UAE officials believe the Gulf economies may absorb the impact of a possible US attack on Iraq and think that any eventual flare up will not last for more than a few weeks as the troubled economy of USA would not be able to sustain the cost of a prolonged military engagement.

Though world markets are predicting higher gold and oil prices and an adverse impact on other economies in case of another Gulf war, the officials here think the war shadows that are hanging for a long time have already slowed down the regional economies and will “marginalize the negative fallout” at the advent of an actual attack on Iraq.

Mohammed Ali Alabbar, Director General of the Department of Economic Development, said in a newspaper interview that Arab economies have already absorbed the adverse impact due to a ‘war hysteria’ that is lingering in the region for many months.