Saudi economy fastest growing globally, posting 7.6%
Saudi Arabia’s economy is the fastest growing in the world by posting 7.6 percent during the current year 2022, according to the International Monetary Fund (IMF).
The IMF’s estimates were revealed by the Saudi Ministry of Investment (MISA) during its release of the Saudi Economy and Investment Monitor report on Sunday regarding the latest economic and investment developments in Saudi Arabia for the second quarter of 2022.
The ministry’s statement said that the IMF’s estimates indicated that the economic, structural and legislative reforms in the Kingdom led to the strength of the Saudi economy, in addition to contributing to the continuation of sustainable growth and competitiveness to attract investments to the Kingdom.
It is noteworthy that Saudi Arabia has implemented more than 600 reforms, which helped and contributed to improving the investment environment, in addition to developing several systems and procedures with its partners from government agencies.
The Saudi Economy and Investment Monitor report revealed that the National Investment Strategy (NIS) has exceeded its investment targets for the year 2021, achieving 112 percent of the total investment targets.
The investment targets of the NIS reached SR738 billion, or 23.6 percent of gross domestic product (GDP) in 2021, compared to a target of SR656 billion.
NIS has also achieved 104 percent of the local investment target, as it reached SR638 billion, compared to a target of SR614 billion. With regard to the foreign direct investment flows targets, it achieved 172 percent to remain at SR72 billion, which is 2.3 percent of the GDP in 2021, compared to a target of SR42 billion.
The real GDP of Saudi Arabia recorded a growth of 11.8 percent compared to the second quarter of 2021, achieving the highest growth since 2011. This rise comes as a result of the significant growth in both oil and non-oil activities by 23.1 percent and 5.4 percent, respectively, compared to the same period of the previous year.
The reason for the rise in oil activities is due to the Kingdom's increase in oil production according to the agreement followed by OPEC + members, which requires a gradual increase in production according to the increase in global demand for oil.
As for unemployment in the Kingdom, the unemployment rate of Saudis decreased to 10.1 percent in the first quarter of 2022, compared to the fourth quarter of 2021, which amounted to 11 percent, and it is worth mentioning that this decrease is the lowest level of Saudi unemployment in 10 years.
With regard to point-of-sale sales and SADAD payments, it has recorded an increase by 16.6 percent and 17.1 percent respectively, during the second quarter of 2022 compared to the same period in 2021.
As for cash withdrawals, it was the exact opposite, recording a decrease of 7.5 percent as a result of the shift in consumer behavior to digital transactions through points of sale. It is noteworthy that the e-payments have exceeded transactions in cash for the first time in Saudi Arabia, as its percentage shot up significantly to reach 57 percent in 2021 of the total number of executed transactions, compared to 36 percent in 2019.
The inflation rate in Saudi Arabia reached 2.3 percent in the Q2 of 2022 on an annual basis, as education prices grew by 6.2 percent, followed by food and beverages by 4.3 percent.
The number of investment licenses also recorded an increase, reaching 673.4 percent compared to the same period last year, while the number of the completed investment deals during the second quarter of 2022 amounted to 49 deals with a total of SR3.5 billion.
According to the ministry’s report, Saudi Arabia achieved several advanced positions in a number of international indicators during 2022, including: ranking first in the Global Consumer Confidence Index: Fifth place in the Edelman Trust Index: and 24th place in the Global Competitiveness Ranking.