{"id":99394,"date":"2025-08-05T00:00:00","date_gmt":"2025-08-05T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/ksa\/2025\/08\/05\/imf-verdict-saudi-economy-is-resilient-and-favorable\/"},"modified":"2025-08-05T00:00:00","modified_gmt":"2025-08-05T00:00:00","slug":"imf-verdict-saudi-economy-is-resilient-and-favorable","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/ksa\/2025\/08\/05\/imf-verdict-saudi-economy-is-resilient-and-favorable\/","title":{"rendered":"IMF verdict: Saudi economy is \u201cresilient\u201d and \u201cfavorable\u201d"},"content":{"rendered":"

Saudi Arabia\u2019s economy demonstrated \u201cstron<\/strong>g resilience to external shocks,\u201d with a<\/strong> favorable outlook despite global uncertainty<\/strong> and emerging deficits, supported by strong policies and reform momentum, the IMF Executive Board said in a statement<\/a> yesterday following its annual Article IV consultations.<\/p>\n

By the numbers:<\/strong> Non-oil GDP grew 4.5% in 2024, offsetting oil production cuts that pulled oil GDP down by 4.4%, lowering overall growth to 2%. Unemployment also fell to a record low and inflation remained contained, though the current account shifted to a small deficit of 0.5% of GDP, down from a 2.9% surplus in 2023. Meanwhile, the banking sector remains robust, and foreign reserves are ample at USD 415 bn.<\/p>\n

REMEMBER- <\/strong>The IMF upgraded Saudi Arabia\u2019s GDP growth forecast by 0.6 percentage points to 3.6% for 2025 and by 0.2 percentage points to 3.9% for 2026 in its latest World Economic Outlook report published last week<\/a>. The fund also amended its oil price outlook, now expecting a more moderate drop to an average of USD 68.18 per barrel in 2025, followed by a slower decline to USD 64.33 in 2026.<\/p>\n

The near-term outlook is vulnerable to downside pressures<\/strong> from weaker oil demand, reduced government spending, and regional instability. However, growth could be boosted by higher oil production, increased Vision 2030 investments, or a rise in oil prices from a stronger global recovery.<\/p>\n

But the medium term is more stable, thanks to strong domestic demand from Vision 2030<\/strong> projects<\/strong> that are expected to keep non-oil growth above 3.5% and accelerate overall real GDP growth to 3.9% by 2026. Inflation is forecasted to remain contained; however, the current account deficit is projected to continue from investment-linked imports and remittance outflows, which will force more external borrowing. Reserve buffers should remain sufficient.<\/p>\n

Recommendations for the Kingdom:<\/strong> The IMF Board recommended a countercyclical fiscal policy in the near term, followed by gradual consolidation through tax and subsidy reforms. It praised Saudi Arabia\u2019s strengthened fiscal institutions, transparency, and well-capitalized banking sector, endorsing the currency peg to the USD while emphasizing sustaining Vision 2030 structural reforms to drive diversification and private sector investment regardless of oil prices.<\/p>\n","protected":false},"excerpt":{"rendered":"

The positive outlook persists despite emerging twin deficits, backed by a strong banking sector and hefty reserves<\/p>\n","protected":false},"author":1,"featured_media":99395,"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":[27,10,1559],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-99394","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","tag-economy","tag-enterpriseam-ksa","tag-international-monetary-fund-imf","wpautop","entry"],"acf":{"mongo_id":"9b40d954-960b-4e45-9f1c-b896a2949d8f","order":"3","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2025\/8\/185.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Saudi economy is \u201cresilient\u201d and \u201cfavorable\u201d -IMF","related_issue":[99389],"teaser":"The positive outlook persists despite emerging twin deficits, backed by a strong banking sector and hefty reserves","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2025\/8\/.a99ef344-873a-4109-9e73-acf20ed07d9b.mp3"},"yoast_head":"\nIMF verdict: Saudi economy is \u201cresilient\u201d and \u201cfavorable\u201d - 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