Aràbia Saudita flag Aràbia Saudita: Visió econòmica i política

El context econòmic d'Aràbia Saudita

Economic Indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Saudi Arabia is the largest economy in the Middle East and the richest Arab country. The policy of large-scale public works undertaken by the authorities, as well as foreign direct investment and the soundness of the banking and financial system, have enabled the country to become the number one regional economy and one of the largest in the world. However, the economy of Saudi Arabia is almost entirely based on oil, with GDP growth being closely linked to real oil growth. In 2021, increasing oil prices and the stabilization of the COVID-19 pandemic contributed to an estimated GDP growth of 2.8% (IMF). The forecasts of the Ministry of Finance, the OECD and the IMF agree on a growth rate of 4.8% in 2022, thanks to the expansion of hydrocarbon activity and resumption of capital projects, before returning again to 2.8% in 2023.

Low oil revenue weighed on Saudi Arabia's current account balance as a consequence of the global pandemic, with an estimated budget deficit of USD 17.1 billion in 2021. Such deficit is likely to be narrowed down to USD 13.8 billion in 2022, as the government projects a surplus in both 2023 and 2024. The measure taken to curb the impact of COVID-19 on the private sector entailed an increase in public debt, which stood at 29.7% in 2021 (from 22.8% before the pandemic). The debt-to-GDP ratio is expected to further increase this year (30.8%) before taking a downward trend in 2023 (30.4% - IMF). Inflation picked up to 3.2% in 2021 partly as a consequence of the hike in the VAT rate from 5% to 15%, and should stabilize around 2% in the upcoming years.

The standard of living in Saudi Arabia is one of the highest in the Middle East, with a GDP per capita of over USD 48,000 (PPP – IMF). According to the latest data available from the Saudi General Authority for Statistics, the unemployment rate of the total working-age population (Saudis and non- Saudis 15 years and above) decreased to 6.6% in the second quarter of 2021; whereas the unemployment rate of total Saudis (males and females 15 years and above), decreased to 11.3% in the same period. Nevertheless, the unemployment rate is much higher for female citizens compared to the male population (22.3% vs. 6.1%).

 
Main Indicators 201920202021 (e)2022 (e)2023 (e)
GDP (billions USD) 792.97700.12842.59876.15899.11
GDP (Constant Prices, Annual % Change) 0.3-4.12.94.82.8
GDP per Capita (USD) 23,174e19,996e23,76224,22424,372
General Government Gross Debt (in % of GDP) 22.832.529.730.830.4
Inflation Rate (%) -2.13.4e3.22.22.0
Unemployment Rate (% of the Labour Force) 5.77.4e0.00.00.0
Current Account (billions USD) 38.23-19.65e32.6133.1719.70
Current Account (in % of GDP) 4.8-2.83.93.82.2

Source: IMF – World Economic Outlook Database, October 2021

Note: (e) Estimated Data

Main Sectors of Industry

Agriculture accounts for 2.6% of Saudi Arabia’s GDP and employs 2% of the active population (World Bank, latest data available). Because of geographical and climatic constraints (droughts), Saudi Arabia imports most of its agricultural and food product requirements. Water scarcity is a serious regional problem that the country is likely to face in the coming years, as the growing cultivation of wheat presents the threat of water depletion. Saudi Arabia is the largest market for agriculture in the GCC region; however, productivity remains limited compared with the public investment that funds the sector.

The industrial sector represents 41.4% of the GDP and employs 25% of the workforce. It is dominated by non-manufacturing activities (oil drilling). The country has the largest oil reserves in the world and is also the largest producer and exporter of oil in the world. Oil accounts for nearly 80% of exports and 70% of government revenues (and more than 40% of GDP). The share of the non-oil industrial sector has been increasing along with the economic diversification efforts of the Saudi authorities (although manufacturing currently represents only 13% of GDP).

Lastly, services represent 56.2% of the GDP and employ 73% of the active population. This sector is mainly dominated by tourism, financial and banking services and the insurance sector. Tourism generates very high revenues (almost 4 million tourists per year), due in particular to the Hajj, the pilgrimage to Mecca that takes place in the last month of the Islamic year, that all Muslims are expected to make at least once during their lifetime. The Saudi government launched the “Financial Sector Development Program”, aimed at enabling financial institutions to support the growth of the private sector, develop an advanced capital market and improve financial planning.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 2.4 24.8 72.8
Value Added (in % of GDP) 2.6 41.4 56.2
Value Added (Annual % Change) -1.7 -5.8 -1.8

Source: World Bank, Latest Available Data. Because of rounding, the sum of the percentages may be smaller/greater than 100%.

 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.}}

Score:
66/100
World Rank:
63
Regional Rank:
5

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 

Business environment ranking

Definition:

The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.

Score:
6.71/10
World Rank:
42/82

Source: The Economist Intelligence Unit - Business Environment Rankings 2021-2025

 

Country Risk

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