Saudi Arabia Economic Forecast

Saudi Arabia Economic Outlook

July 7, 2020

Still grappling with measures to contain the pandemic and the stark fall in oil production, the economy likely contracted at a sharper pace in the second quarter after declining at the quickest clip in over two years in the first quarter due to weakness in the non-oil sector. Despite gradually easing measures since late April, international borders remain closed and bans on religious pilgrimages were upheld, which will have hammered the tourism and retail sectors. Moreover, the suspension of living allowances and depressed consumer confidence likely continued to drag on private spending. Turning to the energy sector, oil output likely plummeted in Q2 as production cuts to bolster prices took effect in May and were extended until end July. On a brighter note, in early June the cabinet approved a new mining law, which aims to accelerate investment into the mining sector and could boost employment and output in the sector going forward.

Saudi Arabia Economic Growth

Economic activity is seen contracting this year, due to curtailed oil production. Moreover, non-oil private-sector activity will likely also take a hit as Covid-19 weighs on the tourism sector and a more restrictive budget hinders the economy. FocusEconomics panelists see the economy contracting 4.7% in 2020, which is down 0.7 percentage points from last month’s projection. In 2021, the panel sees economic growth at 3.4%.

Saudi Arabia Economy Data

2015 2016 2017 2018 2019
Population (million)31.131.832.633.434.1
GDP per capita (USD)21,06320,28421,11323,53623,265
GDP (USD bn)654645689786793
Economic Growth (GDP, annual variation in %)4.11.7-0.72.40.3
Consumption (annual variation in %)-  -  -  -  -  
Investment (annual variation in %)3.7-14.00.7-2.14.0
Industrial Production (annual variation in %)5.02.3-2.42.7-2.6
Unemployment Rate5.75.65.96.05.6
Fiscal Balance (% of GDP)-15.8-12.9-9.2-5.9-4.5
Public Debt (% of GDP)5.813.117.219.022.8
Money (annual variation in %)2.50.80.32.77.1
Inflation Rate (CPI, annual variation in %, eop)1.21.0-1.11.9-0.2
Inflation Rate (CPI, annual variation in %)1.22.1-0.82.5-2.1
Policy Interest Rate (%)2.002.002.003.002.25
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)-8.7-3.71.59.06.3
Current Account Balance (USD bn)-56.7-23.810.570.649.8
Trade Balance (USD billion)44.355.898.5169129
Exports (USD billion)204184222294262
Imports (USD billion)159128123126132
Exports (annual variation in %)-40.6-9.820.932.7-11.2
Imports (annual variation in %)0.5-19.8-3.51.85.3
International Reserves (USD)616536496496499
External Debt (% of GDP)13.824.627.728.1-  

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Saudi Arabia Facts

Value Change Date
Bond Yield2.490.0 %Jun 23
Exchange Rate3.750.0 %Dec 31
Stock Market0.21.00 %Jan 07

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