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Analysts: Saudi Arabia's Economic Flexibility Strengthens Resilience to Shocks
🇸🇦 Saudi Arabia /Economy & Trade

Analysts: Saudi Arabia's Economic Flexibility Strengthens Resilience to Shocks

From Asharq Al-Awsat · () English

Translated from English, summarized and contextualized by DistantNews.

At a glance

News Named sources Context piece
  • The IMF forecasts Saudi Arabia's economy to grow 5.5% in 2027, driven by oil and non-oil sectors, consumption, and investment.
  • Economists cite the Kingdom's strong public finances and non-oil activity as key to withstanding geopolitical challenges and supply chain disruptions.
  • Long-term investments in infrastructure and strategic reserves enhance the economy's resilience and ability to absorb external shocks, according to analysts.

Saudi Arabia's economy is poised for robust growth, with the International Monetary Fund (IMF) projecting a 5.5 percent GDP increase in 2027. This forecast, supported by a recovery in both oil and non-oil sectors, reflects continued strength in consumption and investment.

These transformations have helped build a more resilient and robust economy capable of absorbing external shocks and maintaining a sustainable growth trajectory.

— Naif AlghaithChief economist at Riyad Bank, commenting on the Saudi economy's resilience.

Economists highlight the Kingdom's sound public finances and accelerating non-oil activity as crucial factors bolstering its capacity to sustain growth amidst geopolitical challenges. While the IMF anticipated a slowdown to 1.7 percent in 2026 due to regional conflicts and shipping disruptions, it expects a rebound the following year as economic activity picks up and Vision 2030 projects advance.

Naif Alghaith, chief economist at Riyad Bank, anticipates Saudi growth exceeding 5 percent in 2027, driven by non-oil sectors which now constitute over half of GDP. Growth in tourism, construction, services, and trade is expected, alongside improved shipping activity and oil production.

the IMF report clearly reflects the strength of the Saudi economy and its high capacity to withstand external shocks.

— Naif AlghaithChief economist at Riyad Bank, on the IMF's assessment of the Saudi economy.

Alghaith emphasized that these transformations have fostered a more resilient economy capable of absorbing external shocks. He noted that Saudi Arabia demonstrated this resilience during recent geopolitical tensions due to strong economic fundamentals and advanced infrastructure, including rerouted logistics that maintained trade flows. Substantial foreign asset reserves and the Kingdom's central role in global energy markets further enhance its shock absorption capabilities.

the IMF’s projections reflect international confidence in Saudi Arabia’s ability to overcome geopolitical crises.

— Abdullah AlmeerAssistant professor of economics at King Fahd University of Petroleum and Minerals, on international confidence in Saudi Arabia.

Abdullah Almeer, an economics professor at King Fahd University of Petroleum and Minerals, stated that the IMF's projections signal international confidence in Saudi Arabia's ability to navigate geopolitical crises. He described the projected 5.5 percent growth in 2027 as an "excellent recovery" given the regional turmoil, underscoring the importance of diversified export routes and flexible infrastructure.

an excellent recovery

— Abdullah AlmeerAssistant professor of economics at King Fahd University of Petroleum and Minerals, describing the projected 2027 growth.
DistantNews Editorial

Originally published by Asharq Al-Awsat in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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