The Saudi Economy in 2021
Macroeconomic ReportLooking out into 2021, while there is still a considerable degree of uncertainty as a result of the prevalence of COVID-19 and its potential impact on the non-oil economy, we nevertheless expect a broad-based recovery. Our forecast assumes between 15-20 percent of the adult population being vaccinated against COVID-19 by mid-2021, and 70 percent by year end. As such, we see a quarter-on-quarter improvement in the Saudi non-oil economy, with this recovery being more vigorous in the second half of 2021.
Update on the Financial Sector Development Program
Macroeconomic ReportIn the last year or so, there has been a fair level of progress on most areas covered by the Financial Sector Development Program (FSDP). In particular, visible progress has been made in the development of the SMEs financing ecosystem, the insurance sector, capital markets and housing.
The Saudi Economy in 2019
Macroeconomic ReportJadwa Investments Saudi economy in 2019 report has forecasted 2 percent growth in the economy during the year. Latest full year GDP data for 2018 shows that the economy was able to absorb most of the disruptive effects of necessary economic reform enacted last year. Looking ahead, as comparably limited major reform is scheduled to take place during 2019, this should clear the way for a pick-up in momentum for the Saudi economy. Overall, whilst the oil sectors output will be partially trimmed by Saudi Arabias commitment to the OPEC and partners (OPEC+) agreement, the report forecasts a marginally higher year-on-year growth in the non-oil sector.
Monetary and Financial Update: Gradual Pickup in Private Sector Lending
Macroeconomic ReportThe US Federal Reserve (Fed) raised the Federal Fund Rate (FFR) in December, and lowered its projections from three to two hikes in 2019. The latest survey data show that the market expects no further hikes in 2019. Therefore, we see a rising level of uncertainty in the Feds rate decisions in 2019, with a downside projection, as the Feds latest statement acknowledged the slowing in global growth.
