{"id":92805,"date":"2024-12-24T00:00:00","date_gmt":"2024-12-24T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/ksa\/2024\/12\/24\/real-gdp-growth-to-hit-1-5-this-year-imf\/"},"modified":"2024-12-24T00:00:00","modified_gmt":"2024-12-24T00:00:00","slug":"real-gdp-growth-to-hit-1-5-this-year-imf","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/ksa\/2024\/12\/24\/real-gdp-growth-to-hit-1-5-this-year-imf\/","title":{"rendered":"Real GDP growth to hit 1.5% this year -IMF"},"content":{"rendered":"

IMF cuts forecasts for this year for the fourth time:<\/strong> The International Monetary Fund (IMF) is projecting real GDP growth in Saudi to come in at a 1.5% clip this year, the international lender said in its Economic Prospects and Policy Challenges for the GCC Countries report (pdf)<\/a>. The latest projection marks the IMF\u2019s fourth downward revision of its growth forecast for Saudi Arabia this year, and most recently projected in July<\/a> would hit 1.7% growth. The report cites extended oil production cuts as the reason for slower-than-expected overall growth in the GCC.<\/p>\n

Growth will pick up in the medium-term:<\/strong> Saudi\u2019s real GDP is now projected to grow 4.6% next year \u2014 down slightly from the IMF\u2019s previously forecasted<\/a> 4.7% growth for 2025 \u2014 and 4.4% in 2026, as oil production cuts continue to ease. This is more or less on par with government targets, which penciled in GDP growth of 4.6% for FY 2025<\/a> on the back of a pick-up in non-oil activities and private sector participation.<\/p>\n

REMEMBER-<\/strong> Real GDP grew 2.8% y-o-y in 3Q, breaking a four-quarter long downward trend, which saw GDP shrink 0.3% y-o-y in 2Q.<\/p>\n

Positive outlook for non-oil activity:<\/strong> The IMF sees the Kingdom\u2019s non-oil sector growing by 3.7% in 2024, before picking up to 4.4% in 2025 and 4.3% in 2026.<\/p>\n

Hydrocarbon\u2019s legacy isn\u2019t going anywhere yet: <\/strong>The hydrocarbon sector is gearing up for a strong rebound in 2025 and 2026 with a projected 5% and 4.8% GDP growth, respectively, following a contraction of -5% in 2024, before moderating to 2.4% in 2027 as production stabilizes.<\/p>\n

Keeping a lid on inflation:<\/strong> Inflation is projected to settle at 1.7% this year, before ticking up to 1.9% in 2025 and 2.0% in 2026. This trajectory aligns with the broader GCC trend. Inflation accelerated to 2% y-o-y in November<\/a>, a slight uptick on October\u2019s 1.9% reading as the gauge hit its highest level so far this year.<\/p>\n

The Kingdom\u2019s current account surplus is projected to narrow to -1.8% of GDP in 2025<\/strong>, down from 0.4% in 2024, reflecting the impact of voluntary oil production cuts and rising investment-related imports, while high hydrocarbon prices and strong non-oil exports will continue to provide a buffer. <\/p>\n

\n

THE REGIONAL ANGLE-<\/p>\n

GCC economies are also set to benefit from the dual momentum of oil sector recovery <\/strong>and strong non-oil sector growth<\/strong>, according to the report. Real GDP for the region is projected to rebound by 1.4% this year, expanding further to 3.5% in 2025 and 4.2% in 2026. The medium-term outlook remains favorable, with non-oil sector growth underpinned by reform implementation and diversification efforts. <\/p>\n","protected":false},"excerpt":{"rendered":"

Inflation to settle at 1.7% in 2024<\/p>\n","protected":false},"author":1,"featured_media":92806,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[2571],"tags":[27,10,335,337,21],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-92805","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","tag-economy","tag-enterpriseam-ksa","tag-gdp","tag-imf","tag-inflation","wpautop","entry"],"acf":{"mongo_id":"2661e741-caa7-4415-ab9d-47944a4e8e64","order":"3","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2024\/10\/1284.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Real GDP growth to hit 1.5% this year -IMF","related_issue":[92800],"teaser":"Inflation to settle at 1.7% in 2024","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2024\/12\/.b52c93f0-a8fe-4603-a281-a2bea6cadf37.mp3"},"yoast_head":"\nReal GDP growth to hit 1.5% this year -IMF - 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