Saudi Arabia Economic Forecast

Saudi Arabia Economic Outlook

June 4, 2019

Saudi Arabia’s strict compliance with the OPEC+ deal likely caused GDP growth to slow sharply in the first quarter. The Kingdom pumped 700,000 barrels per day less in Q1 compared to Q4. Moreover, the housing market remained depressed in Q1, with the real estate price index falling to a new low in the period. On the upside, the rally in oil prices observed in Q1 increased government spending and prompted the budget balance to post its first surplus in five years in the quarter. Stronger public spending likely boosted activity in the non-oil sector, while higher oil prices supported private lending. Economic activity, however, could worsen in the months ahead after escalating trade tensions between China and the United States dramatically ended the rally in oil prices in late April, with oil prices trading lower on a year-on-year basis in recent days.

Saudi Arabia Economic Growth

Economic growth will moderate this year due to a cut in oil production, negative spillovers from Saudization in some sectors, especially in the wholesale and retail sector, and a fragile real estate sector. However, the economy should benefit from higher oil prices, while an expansionary fiscal policy should support the non-oil sector. Met the why particular panelists expect growth of 1.6% in 2019, which is down 0.1 percentage points from last month’s projection, and 2.2% in 2020.

Saudi Arabia Economy Data

20132014201520162017
Population (million)30.030.831.031.732.4
GDP per capita (USD)24,89224,57721,09520,31321,120
GDP (USD bn)747756654645684
Economic Growth (GDP, annual variation in %)2.73.74.11.7-0.7
Consumption (annual variation in %)3.26.16.82.22.0
Investment (annual variation in %)5.67.53.7-14.4-7.0
Industrial Production (annual variation in %)0.23.15.02.4-2.3
Unemployment Rate5.65.85.75.65.9
Fiscal Balance (% of GDP)6.4-2.3-14.8-12.9-8.9
Public Debt (% of GDP)2.11.65.813.117.1
Money (annual variation in %)11.114.62.43.6-1.0
Inflation Rate (CPI, annual variation in %, eop)2.51.91.31.0-1.1
Inflation Rate (CPI, annual variation in %)3.52.21.22.1-0.8
Policy Interest Rate (%)2.002.002.002.002.00
Exchange Rate (vs USD)3.753.753.753.753.75
Exchange Rate (vs USD, aop)3.753.753.753.753.75
Current Account (% of GDP)18.19.8-8.7-3.72.2
Current Account Balance (USD bn)13573.7-56.7-23.815.2
Trade Balance (USD billion)22318444.355.8112
Exports (USD billion)376342204184221
Imports (USD billion)153158159128119
Exports (annual variation in %)-3.2-8.9-11.6-9.820.4
Imports (annual variation in %)8.13.30.5-19.8-6.6
International Reserves (USD)726732616536496
External Debt (% of GDP)12.313.113.819.8-  

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Saudi Arabia Facts

ValueChangeDate
Bond Yield2.490.0 %Jun 23
Exchange Rate3.750.0 %Jun 13
Stock Market0.21.00 %Jun 13

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