Moody’s predicts a strong 4.6% growth for Saudi Arabia’s GDP in 2024, ranking it among a global fast-riser!

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As per the note published by credit ratings agency Moody’s in November, Saudi Arabia will be among the growing economies in the world by 2024.  The GDP of Saudi Arabia is predicted to expand by 4.6% in the next year.

Moody said that the Saudi kingdom’s credit viability majorly comes from the government’s balanced sheets backed by substantial foreign currency reserves. 

Saudi Arabia’s powerful economy, high per capita income, and growing institutions play a significant role in its economic expansion, highlighted by the report. 

The positive outlook suggests that by making changes and investing in sectors other than oil, the country’s reliance on oil for its economy and finances is likely to decrease over time. This reduces vulnerability to changes in oil prices and global carbon transition. Additionally, it lessens the pressure to increase public spending to support the kingdom’s social contract, as mentioned in the report.

Along with Saudi Arabia India and Indonesia are expected to grow their GDP by 6.2% and 5% respectively in 2024. 

Saudi Arabia is also expected to surpass Sub-Saharan Africa (4.5 percent), China (4 percent), Asia-Pacific (4 percent), and Central Europe (3.7 percent) in 2024. 

Next year, the United States, Canada, France, and Germany are expected to have growth below 1 percent. After raising interest rates aggressively, the rest of the world is dealing with slow growth. 

Moody’s expects slower growth in big economies in 2024, compared to 2023, due to high prices and past tightening of monetary policies. However, if central banks control inflation well, a more relaxed monetary approach in 2024 could help economies approach pre-pandemic growth rates by 2025, according to the note. 

Saudi Arabia’s economy grew by 1.2 percent in the second quarter of 2023, driven by a significant 6.1 percent increase in the non-oil sector, according to a report from the General Authority for Statistics. 

Moody’s upgraded its growth forecast for the country to 2.5 percent in 2023 (from the earlier estimate of 1.7 percent) and to 3 percent in 2024 (up from the previous forecast of 2.6 percent), indicating positive economic momentum.

Source by: Arabian Business

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