It’s a slow morning for the Kingdom in the foreign press with pundits weighing in on how a drop in oil activity is straining the Kingdom’s economic growth amid waning demand from Chinese and US clients coupled with globally high interest rates. “Contraction in GDP is really a story of oil sector restraint where Saudi Arabia is committed to voluntary cuts, getting the rest of Opec+ to do so…,” Ziemba Insights’ founder Rachel Ziemba told CNBC (watch, runtime: 3:52)

IN CONTEXT- Ziemba’s commentary comes as state statistics agency Gastast released its quarterly report on domestic economic performance which saw the economy contracting at a slightly slower pace in 1Q 2024 than initially reported on the back of a decline in oil activity.

We could be seeing more sovereign sukuk, gov’t asset sales and a shift towards local spending: “There is this real question about whether demand globally is going to pick up and if it doesn't for oil — the kingdom’s greatest revenue source — then we’ll continue to see some asset sales and debt issuances as they try to continue the stimulus, and direct investments… The Kingdom is going to be more and more focused on investing at home and not so much investing abroad,” Ziemba said.

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