Saudi Gazette report

RIYADH — In a highly anticipated report following the conclusion of their 2023 Article IV Consultation discussions with Saudi Arabia, the International Monetary Fund (IMF) has issued a resounding vote of confidence in the nation's economic health and reform initiatives.

The IMF's comprehensive assessment affirmed that Saudi Arabia is currently enjoying a period of robust economic growth, with a strong fiscal position and notable progress in implementing its ambitious Saudi Vision 2030 reform agenda.

Here are the key takeaways from the IMF report:

Saudi Arabia was hailed as one of the fastest-growing G20 economies in 2022, registering an impressive growth rate of 8.7%. Non-oil GDP also continued to surge at around 4.8%, while unemployment among Saudi citizens reached its historic low at just 8%.

Saudi Arabia has achieved remarkable strides in increasing female participation in the labor market, with women now constituting about 37%, exceeding the 2030 target of 30% set by Saudi Vision 2030.

The report commended the Kingdom's efforts in containing inflation, noting that a combination of domestic subsidies, price caps on select products, and the strength of the US dollar contributed to keeping the consumer price index (CPI) at a moderate 2.5% in 2022.

The IMF emphasized that Saudi Vision 2030's reforms are on track to reduce the nation's dependence on oil. Non-oil GDP growth is projected to continue its robust trajectory, with an average growth rate expected to reach 4.9% in 2023.

Saudi Arabia's fiscal policies and reforms have led to low and sustainable debt levels, providing a strong fiscal space. The IMF applauded the Kingdom's efforts to improve non-oil revenues, rationalize spending, and enhance public finance transparency.

The report stated that Saudi Arabia's fixed exchange rate policy is well-suited to the Kingdom's economy. The banking sector remains strong, with high profitability rates, capital adequacy ratios, and low non-performing loan ratios.

The IMF praised Saudi Arabia's commitment to environmental initiatives, including becoming the largest producer of clean hydrogen globally and reducing carbon emissions, positioning the Kingdom as a leader in sustainability.

Saudi Arabia's digital transformation efforts earned recognition, with high rankings in global digitization metrics. The digital progress has improved financial inclusion, the resilience of the financial sector, and government effectiveness.

In response to the IMF report, Finance Minister Mohammed Al Jadaan expressed his satisfaction with the Fund's acknowledgment of the Kingdom's economic reforms and solid fiscal position. Al Jadaan noted that the report highlighted both current achievements and promising prospects for the Saudi economy.

The IMF's assessment underscores Saudi Arabia's resilience in the face of challenges, attributing its success to economic and structural reforms that have fostered sustainable and inclusive growth.

This latest IMF report aligns with the previous statement issued by the Fund following the conclusion of the 2023 Article IV Consultations with the Kingdom's government, confirming the positive trajectory of Saudi Arabia's economic transformation.