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RIYADH: The International Monetary Fund has revised up its forecast for ������Ƶ’s economic growth in 2025, raising it to 3.5 percent from the 3 percent projected in April.

In its concluding statement following an Article IV consultation, the IMF highlighted the pivotal role of Vision 2030 mega projects in sustaining the Kingdom’s economic momentum, noting its continued resilience amid lower oil prices and shifting international challenges.

The IMF projects Saudi economic growth will outpace the global average of 2.8 percent in 2025, as well as outstripping most of its Gulf peers.

“Robust domestic demand — including from government-led projects — will continue to drive growth despite heightened global uncertainty and a weakened commodity price outlook,” the IMF stated in its new report. 

The fund expected this momentum, supported by the scheduled phase-out of OPEC+ production cuts, to push growth even higher to 3.9 percent in 2026 before stabilizing around 3.3 percent in the medium term.

The Saudi Ministry of Finance welcomed the IMF’s concluding statement, highlighting its confirmation of “the strong resilience of the Saudi economy in the face of global economic shocks, supported by the expansion of non-oil sector activities, containment of inflation, and a historically low unemployment rate — all aligning with the objectives of Saudi Vision 2030.”

The ministry noted the IMF’s praise for the government’s efforts to enhance public finance sustainability and resilience to shocks, as well as its recognition that strong domestic demand continues to support economic growth despite global uncertainty, reflecting the Kingdom’s continued implementation of Vision 2030 projects.

Non-oil gross domestic product growth, a key indicator of diversification success, is projected to grow at 3.4 percent in 2025. 

While slightly lower than the 4.2 percent achieved in 2024, the IMF attributed this sustained performance to “continued implementation of Vision 2030 projects through public and private investment, as well as strong credit growth, which would help sustain domestic demand and mitigate the impact of lower oil prices.” 

Medium-term non-oil growth is expected to approach 4 percent by 2027 before stabilizing at 3.5 percent by 2030.

The IMF also noted positive developments in the labor market and inflation. The unemployment rate for Saudi nationals fell to a record low of 7 percent in 2024, surpassing the original Vision 2030 target.

Headline inflation, despite a small rise to 2.3 percent in April, remains contained. 

“Inflation would remain anchored around 2 percent, supported by a credible peg to the US dollar, domestic subsidies, and an elastic supply of expatriate labor,” the fund projected.

On fiscal policy, the IMF deemed the anticipated higher spending in 2025, leading to a deficit above budget targets, as “appropriate.”

“Given the upfront adjustment and ample fiscal buffers available, staff believes that additional spending restraint in 2025— triggered by lower-than-budgeted oil prices— is not necessary as it would make fiscal policy procyclical and exacerbate the impact on growth,” the statement added.

However, it emphasized the need for gradual fiscal consolidation over the medium term, recommending measures like non-oil revenue mobilization, removing energy subsidies, and rationalizing spending.

The IMF highlighted the banking sector’s resilience but cautioned about the risks associated with strong credit growth. “Addressing strong credit growth and associated funding pressures would help mitigate risks to systemic financial stability,” the report urged. 

It welcomed the Saudi Central Bank’s recent introduction of a countercyclical capital buffer and ongoing efforts to enhance regulatory frameworks.

The fund strongly emphasized the need for continued structural reforms. “The current environment of heightened uncertainty underscores the importance of continued structural reform efforts to sustain non-oil growth and economic diversification,” the statement concluded.

It added: “The reform momentum should continue irrespective of oil price developments.” 

This includes strengthening anti-corruption frameworks, enhancing human capital, improving access to finance, fostering digitalization, and deepening capital markets.

RIYADH: ������Ƶ’s Najran region has recorded a 56 percent increase in commercial registrations over the past five years, signaling expanding economic activity and growth potential in the southern province.

According to government data presented at the Najran Investment Forum 2025, business licenses in the region reached 39,000, accounting for around 2.3 percent of the Kingdom’s 1.7 million total records.

The forum, held from June 25 to 26 under the patronage of Prince Jalawi bin Abdulaziz bin Musaed, brought together government officials and private sector leaders to highlight economic prospects in the region. According to organizers, the event featured 53 project opportunities valued at over SR639 million ($170 million).

The southern province is emerging as a regional development hub under Vision 2030. With its mineral wealth, fertile land, cultural heritage, and growing logistics capabilities, it is positioned as a gateway for trade and business in line with the Kingdom’s economic diversification goals.

Speaking during the forum’s opening session, Assistant Minister of Commerce Abdulaziz bin Saud Al-Duhaim said: “Najran is an important region that abounds with diverse investment opportunities, based on its geographical location, natural resources, and competitive sectors such as agriculture, mining, manufacturing industries, tourism, and others.”

He added: “We have reviewed and developed more than 110 pieces of legislation over the past few years, most notably regulations on companies, franchises, e-commerce, bankruptcy, commercial registration, trade names, and others.”

The region’s light transport sector saw the largest increase in new registrations, up 124 percent year on year in the first quarter to 536. The logistics sector followed with 111 percent growth, totaling 345 records. Registrations in civil protection equipment installation and maintenance rose by 26 percent, while storage facilities climbed 31 percent, reaching 717 records.

During his participation in the forum, Al-Duhaim also emphasized that the Ministry of Commerce has strengthened market regulations to protect consumers, monitor prices, and combat fraud and commercial cover-ups.

“We are working on a comprehensive consumer protection system, established a reporting center and a summons center, and launched the ‘Emtithal’ electronic inspection and monitoring system,” he said.

The assistant minister also noted that the National Competitiveness Center has worked with more than 65 government agencies, in partnership with the private sector, to implement over 900 economic reforms and recommendations aimed at enhancing business competitiveness. 

He added that 21 branches of the Saudi Business Center have been established to facilitate business start-ups and operations.

“The Ministry is working to develop and implement comprehensive strategies for the wholesale, retail, and professional services sectors, and to develop the services sector by leveraging new technologies,” Al-Duhaim said.

During the event, 14 cooperation agreements were signed between the Najran Chamber and various public and private entities to support local initiatives and business development.

Abdullah bin Ali bin Mohammed Al-Ahmari, assistant minister of industry and mineral resources for planning and development, who also participated in the event, noted that Najran is one of the richest regions in mineral resources, with the estimated value of untapped reserves rising from SR145 billion to more than SR227 billion.

He also emphasized the importance of developing mining-related manufacturing industries to maximize added value and boost exports.

In the same context, Abdullah Al-Dubaikhi, assistant minister of investment, discussed the province’s competitive advantages, noting that the area offers promising opportunities in mining, specialized agriculture, tourism, and education — sectors that require coordinated efforts among relevant authorities to unlock their full potential.

He noted that total projects registered on the Invest in ������Ƶ platform for the region amounted to approximately SR8 billion.

The forum aimed to showcase the area’s economic potential, attract quality investments, and provide an effective platform for engagement between local and international investors and government agencies.

“The ministry has been committed to addressing all challenges facing the business sector by developing legislation, facilitating procedures, and expanding financing programs and solutions that empower entrepreneurship and commercial establishments,” Al-Duhaim added.