IMF Commends Saudi Reforms within Vision 2030

Washington, Riyadh — Timothy Callen, IMF Mission Chief for Saudi Arabia, lauded the reforms implemented by Saudi authorities within Saudi Vision 2030 from “adjusting fiscal policy to the realities of lower oil prices,” enhancing the business environment and increasing transparency.

Callen also praised the kingdom’s permission for women to drive, noting that it is a great step in the field of encouraging recruiting, productivity and women participation in the labor force.

In a news conference on the outcomes of Article IV Consultations with Saudi Arabia and the issuance of Financial Sector Assessment Program (FSAP), lead researcher Mostafa El-Sayed and Timothy Callen asserted that the Saudi authorities succeeded in adopting reforms that led to the decline of the deficit in a high rate.

Saudi Finance Minister Mohammed al-Jadaan welcomed the report that clarifies the positive impact of economic reforms performed by the kingdom within Saudi Vision 2030.

IMF staff commended Saudi Arabia’ efforts to enhance non-oil revenue and welcomed its plan for further energy price reforms. They welcomed recent improvements in the fiscal framework and fiscal transparency, as well as the findings of the Financial System Stability Assessment report that showed banks are well regulated and supervised.

They also mentioned the good progress being made in identifying and removing obstacles to private sector growth, but stressed that increasing the employment of Saudi nationals in the private sector was essential.

According to the report, non-oil growth is projected to pick up to 1.7 percent in 2017. The fiscal deficit is projected to narrow substantially in the coming years. It is expected to decline from 17.2 percent of GDP in 2016 to 9.3 percent of GDP in 2017, and to just under 1 per cent of GDP by 2022.

King Salman Receives Positive Annual Report from SAMA

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Jeddah- Custodian of the Two Holy Mosques King Salman received on Tuesday the 53rd annual report of the Saudi Arabian Monetary Authority (SAMA), which reviews the economic and financial developments in the Kingdom during the year 2016.

The report was presented to the King by Minister of Finance Mohammed al-Jadaan, SAMA Governor Ahmed al-Khulaifi, and deputy governors of SAMA at Al-Salam Palace in Jeddah.

King Salman lauded SAMA’s efforts to serve the national economy and wished every success to all.

Speaking on the occasion, SAMA Governor al-Khulaifi said “The supply and demand in the international oil market led to a decrease in the average price of Arab light oil by 18 percent to reach about $41 a barrel in 2016.”

He added that the Kingdom’s economy achieved positive growth of 1.7 percent in 2016 and that the Saudi leadership is keen to maintain an improved standard of living for citizens. To achieve this goal, the government spent a total of SR830.5 billion (USD221 billion) in 2016.

“This contributed to mitigating the impact of a drop in oil prices on the local economy and the services provided by the government to citizens,” Khulaifi stated.

He added that the non-oil private sector achieved positive growth of about one percent while the general cost of living index rose by 3.5 percent compared to 2.2 percent in 2015.

Inflation rate posted a decline in 2017, with an average fall of 0.4 percent during the first eight months of the current fiscal year after registering an increase in 2106.

Khulaifi said the SAMA annual report included several positive statistical indicators that reemphasize the strength of the financial and banking sector in the Kingdom.

The Financial Sector Development Program, approved by the Council of Economic and Development Affairs, along with other programs to achieve the Saudi Vision 2030, aims at enhancing the efficiency of the financial sector in supporting the development of the national economy, diversifying its sources of income as well as its ability to stimulate savings, finance and investment.

Saudi Finance Ministry Inaugurates E-Portal to Empower Government Bodies

Riyadh- Saudi Finance Minister Mohammed al-Jadaan has inaugurated, in his headquarters in Riyadh, Itimad portal for governmental e-services, under the framework of Saudi Vision 2030, to empower government bodies to implement their Saudi Vision 2030 projects, starting from National Transformation Program 2020.

Itimad e-portal services are available for 79 governmental parties, 18 offices (responsible for achieving the vision), rationalizing office and the administrations of following up transactions and budget in the Ministry of Finance.

Jadaan lauded the significance of Itimad since it falls under the digital transformation of all government transactions and reinforces the fruitful and effective communication among ministries and bodies concerned in executing the projects of Saudi Vision 2030 and National Transformation Program 2020.

Further, the portal offers e-services that contribute to effective spending, saving time and reducing administrative and procedural effort between the Ministry of Finance and beneficiaries – thus leading to quicker procedures and better results.

Ahmad al-Souyan, the ministry’s deputy for technical and development affairs, said that “Itimad is a digital platform to provide several financial electronic services.” He added that the ministry is seeking to expand digital services and issue new licenses to empower government bodies and the private sector within the goals of Saudi Vision 2030.

Saudi Vision 2030, Itimad, Mohammed al-Jadaan, National Transformation Program 2020, Ahmad al-Souyan

Itimad

Riyadh – Saudi Finance Minister Mohammed al-Jadaan inaugurated the Itimad portal for governmental e-services, under the framework of Saudi Vision 2030, to empower governmental bodies to implement their Vision projects, starting from National Transformation Program 2020.

Itimad e-portal services are available for 79 governmental parties, 18 offices (responsible for achieving the vision) and the administrations of following up transactions and budget in the Ministry of Finance.

Jadaan lauded the significance of Itimad since it falls under the digital transformation of all governmental transactions and reinforces fruitful and effective communication among ministries and bodies concerned in executing the projects of Saudi Vision 2030 and National Transformation Program 2020.

Furthermore, the e-services of this portal contribute in effective spending. They also help save time and reduce administrative and procedural effort between the Ministry of Finance and beneficiaries, which would make speed up procedures and yield better results.

Ahmad al-Souyan, the ministry’s deputy for technical and development affairs, said: “Itimad is a digital platform to provide several financial electronic services.”

He added that the ministry is on a mission to expand digital services and issue new licenses to empower governmental bodies and the private sector towards reaching the goals of Saudi Vision 2030.

Crown Prince Meets with UK’s Special Representative on Saudi Vision 2030

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Jeddah- Crown Prince Mohammed bin Salman bin Abdulaziz, Deputy Premier and Minister of Defense, met on Sunday with UK’s Special Representative on Saudi Vision 2030 Ken Costa.

During the meeting, they reviewed a number of Saudi-British programs related to the Saudi Vision 2030 as well as mechanisms for implementing these programs.

The meeting was attended by Minister of Commerce and Investment Dr. Majid Al-Qasabi, Minister of Finance Mohammed Al-Jadaan and a number of officials.

Saudi Arabia Provides 50% of Arms Purchases by 2030

Riyadh- Saudi Finance Minister Mohammed al-Jadaan said that the agreement signed on Saturday with the US to localize the arms industry in the kingdom will provide 50 percent of the kingdom’s purchases of arms in 2030.

He said that details of the agreement -one of many others with the US side- will be announced by the competent authorities.

The minister of finance stated that the deal would strengthen the Saudi economy in various fields and contribute to creating job opportunities for young Saudis.

Jadaan said that during the preparation phase for launching Saudi Vision 2030 the Saudi points of strengths and special features were considered along with the Saudi market potentials.

“This was represented in hundreds of workshops that took place for seven months and included initiatives special to the Saudi Vision 2030,” he added.

During a joint news conference for Jadaan, Mohammad Abdul Malik Al Shaikh, chairman of the General Authority of Sports, and Mohammad al-Tuwaijri, deputy minister of economy and planning, the finance minister stated that there are ten programs and the main focus will be the national transformation program launched in 2017.

Shaikh said that the General Authority of Sports is, meanwhile, considering several agreements with other parties to restructure the sports sector in the kingdom and develop it in line with Saudi Vision 2030.

As for Tuwaijri, he stated that meetings with CEOs of US companies have shown willingness from the American side to localize jobs, technology and knowledge in the kingdom.

He added that there is a comprehensive industrial strategy and an absolute conviction through Saudi Vision 2030 that the economy, which does not rely on exports, faces huge difficulties in growth.

The deputy minister of economy and planning revealed that there is a thorough and ambitious program through the vision that aims at restructuring the economy and diversifying its sources instead of depending on one source.

Saudi Arabia Close to Top 15 Economies in the World

Saudi Finance Minister Mohammed al-Jadaan.

Riyadh-Saudi Ministry of Finance submitted its strategy to enable Saudi Arabia to be among the 15 largest economies in the world by 2030 with 22 programs and 74 projects the Kingdom is working on achieving them by 2020.

Saudi Finance Minister Mohammed al-Jadaan unveiled a stimulus package that involves a four-year SR200bn program that is intended to provide low-cost loans to help businesses restructure debts, extend lending limits to companies that contribute to employment and fund small- and medium-sized enterprises.

“The government made a clear commitment that it will increase the level of transparency,” Jadaan said.

“We will for the first time in Saudi Arabia announce, possibly in a couple of weeks or less, the first quarterly results of the budget,” Jadaan told the Euromoney Saudi Arabia Conference.

He said that his ministry has prepared a strategy aiming at enabling Saudi Arabia to be among the largest 15 economies in the world through developing a distinct financial system.

“To achieve this goal the Kingdom has adopted a strategy that is based on five pillars related to developing sustainable financial policies, improving the efficiency of the management of the financial resources, improving the quality of accounts, enhancing transparency, optimizing the utilization of state assets and boosting the Kingdom’s position globally and regionally.”

According to Jadaan, some of the most important projects include developing the framework of public finance, building government revenue policies, improving budget preparation and implementation, enhancing the government procurement system, transferring to accrual based accounting, boosting the regional and international presence of the Kingdom and improving cash management.

Saudi Arabia: Restoring Allowances for State Personnel End of May

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Riyadh – Saudi Finance Ministry has revealed that restoring allowances for the state personnel take place by the end of May.

Finance Minister Mohammed Al-Jadaan said in Monday’s statement that the ministry received inquiries from local media means on the application date of the royal order of Custodian of the Two Holy Mosques King Salman bin Abdulaziz in restoring allowances for state personnel – Jadaan added that the ministry will cooperate with public authorities to include the allowances with the salary of the 30th of Sha’aban.

King Salman issued on Saturday a royal decree to restore financial allowances for civil servants and military personnel.

This decree stems from the recommendation of Saudi Deputy Crown Prince and Minister of Defense and President of Council of Economic and Development Affairs Mohammed bin Salman.

The order was issued at a time when state revenues were deteriorating due to the huge drop in oil prices – oil is considered the main supplier of the state revenues. The Council of Economic and Development Affairs took several policies, initiatives and programs to control the expenditure and to arrange priorities.

This coincided with revising the strategy of the Public Investment Fund of Saudi Arabia and its investments in the country and abroad for the purpose of diversifying income sources and limiting dependency on oil as a main supplier of the state revenues.

Overall, this contributed in achieving purposes of enhancing state revenues and reducing deficit in the budget in light of Saudi Vision 2030.

Moody’s: Saudi Arabia’s Fiscal Position Remains Strong

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Riyadh – Saudi Arabia’s fiscal position remains strong, according to Moody’s Global Credit Research report published on Friday. The report pointed out that economic reforms executed by the kingdom will contribute in curbing the public budget deficit despite the drop in oil prices.

Moody’s A1 rating outlook is supported by the Kingdom’s strong fiscal position – the report also forecast that government’s revenue sources will become diversified, with oil and gas revenue declining to 54 percent by 2020.

Moody’s anticipated only a mild real GDP shrinkage of 0.2 percent in 2017 due to lower oil production.

This classification coincides with the Saudi Finance Ministry affirming that the country’s economy stands on solid foundation and that there is a plenty of international monetary assets at the Saudi Arabian Monetary Authority.

The high confidence of Moody’s in the Saudi economy reflects these corporations’ certainty that the Saudi economy will manage to move to the post-oil phase – as set in the Saudi Vision 2030.

In this context, the Ministry of Finance announced last week that Saudi Arabia’s Fitch outlook has moved from negative to stable, noting that the recent downgrade to the Sovereign rating was based on a quantitative, number-driven analysis.

“The fundamentals of the Saudi economy remain strong,” Finance Minister Mohammed al-Jadaan said in a statement.

“General government assets exceed the global domestic product (GDP) with 100%. Through the Saudi Vision 2030, we applied several initiatives aiming at cementing the structure of economy,” Jadaan added.

He concluded by saying that “these efforts have been made possible through strengthened governance, institutionalization of structural reforms, and enhanced transparency.”