Saudi non-oil economy on solid growth trajectory
Saturday, 09 07 2019, Category: Economy, Country: Saudi Arabia
The Saudi non-oil economy is on track for a solid growth trajectory for 2019, according to a new report from investment firm Riyad Capital.
Riyad Capital based its positive outlook for growth on a variety of factors, including positive signs in the Saudi real estate sector and large investment inflows from the Kingdom’s introduction to the MSCI Emerging Markets Index this year.
The report highlighted continued non-oil GDP growth, as real and nominal GDP of the non-oil private sector expanded at similar growth rates in Q1 2019 - 2.3 and 2.1 percent year-on-year respectively.
The report also pointed to likely spending increases having a positive impact on the domestic economy.
Saudi Arabia has reported that fiscal revenue has been in line with budget targets for the first half of the year, whilst fiscal spending has failed to hit its budget and is still around 7.5 percent behind its target. Riyad Capital expects strong spending increases will alter this dynamic in H2 2019, benefitting the domestic economy.
Riyad Capital also predicted that a turnaround may be on the horizon for the Saudi real estate market, which has been in protracted decline – residential and commercial prices have fallen 17 and 25 percent since 2015 respectively. The report notes that this trend might be coming to an end, with the sector showing signs of recovery.
Source: Al Arabiya