S. Arabia’s non-oil growth to hit 4.4% – IMF

Saudi Arabia’s non-oil growth is projected to reach 4.4 percent in the medium term after moderating in 2024, driven mostly by stronger domestic demand as project implementation picks up, the International Monetary Fund (IMF) said in a recent statement.

The IMF expects the phase-out of oil production cuts to boost overall growth to 4.7 percent in 2025, before averaging 3.7 percent per year thereafter. Inflation would remain contained, supported by a credible peg to the US dollar and consistent domestic policies, it added.

The current account surplus narrowed significantly to 3.2 per cent of GDP in 2023, signalling reduced oil exports and high investment-related imports. These were partly mitigated by a record surplus in the services balance, involving a 38 percent rise in net tourism income. The kingdom’s reserves remain ample, covering 15.8 months of imports and 208 percent of the IMF’s reserve adequacy metric by end-2023.

The IMF Executive Board commended Saudi Arabia’s economic reforms under Vision 2030 and stressed the importance of maintaining fiscal prudence and advancing structural reforms.

Attribution: IMF

Subediting: Y.Yasser