Saudi Arabia Economic Forecast

Saudi Arabia Economic Outlook

April 2, 2019

Activity in the non-oil sector gained steam at the outset of the first quarter, mostly due to improving domestic orders, while oil prices continued to rise in recent weeks thanks to OPEC’s strong compliance to the oil production curbs. However, job creation remained subdued, highlighting the inability of the government to boost employment for Saudis. On 28 March, official sources corroborated that state-owned energy giant Aramco will issue its first-ever international bond, perhaps as soon as this week, which is expected to amount to USD 11 billion. The issuance will force Aramco to disclose financial statements for the first time since its creation in 1988 and will be used to fund the acquisition of the also state-controlled petrochemicals company Sabic for around USD 70 billion. Aramco’s purchase of Sabic will fill the coffers of the country’s sovereign wealth fund used to promote the Saudi Vision 2030.

Saudi Arabia Economic Growth

Economic growth will moderate this year on the heels of lower oil production in compliance with the OPEC+ deal. However, an expected increase in oil prices will allow the government to spur public investment and support non-hydrocarbon activities. Developments in the oil market and geopolitical risks will shape the Kingdom’s economic outlook this year. Met the why particular panelists expect growth of 1.8% in 2019, which is down 0.1 percentage points from last month’s projection, and 2.1% 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 %Apr 12
Stock Market0.21.00 %Apr 11

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