A recently released detailed report on the economy of Saudi Arabia by the IMF finds the Kingdom’s current economic situation is on solid footing with near-term growth expected to continue, but warns of a looming fiscal deficit in 2015.
“Saudi Arabia’s economy has grown very strongly in recent years, benefitting from high oil prices and output, strong private sector activity, and government spending. It has played a systemic and stabilizing role in the global oil market. The economy has not been affected by the recent global financial market volatility. The Saudi population is young, growing, and increasingly well educated,” the IMF said.
With economic diversification “a challenge given Saudi Arabia’s vast oil resources,” the Fund said, “[t]he government is making considerable efforts to lay the groundwork for further diversification by upgrading infrastructure, strengthening education and skills, boosting access to finance for SMEs, and improving the business environment.”
The IMF report says that despite progress on diversification, “more needs to be done to realign incentives to encourage firms to export and workers to seek jobs in the private sector.”
[CLICK HERE TO VIEW AND DOWNLOAD THE FULL REPORT FROM THE INTERNATIONAL MONETARY FUND]
