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Home - June 2020

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ECONOMIC TRENDS

Despite the pandemic, the kingdom remained a popular destination for foreign-funded projects in various sectors.


PETROCHEMICALS

Even at the height of the lockdown, production continued unabated as the industry fires on all cylinders to meet huge demand for essential goods.

COVID-19

Pandemic has shaken the world economy's foundation but the World Bank predicts recovery, with Saudi Arabia well positioned to rebound.

RETAIL

Online shopping bucked the trend and compensated for the drop in mall footfall, prompting FMCG and retail companies to push ahead with investment plans.


SME

Innovative companies are thriving in the kingdom, where they are backed by administrative and financial support from the government and venture capitalists.


COMMODITIES

Prices of oil, gold and aluminium are seeing a resurgence, as economic activities restart following months of shelter-in-place policy to curb the coronavirus spread.

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 IN THIS EDITION

Saudi Arabia’s minister of finance and acting minister of economy and planning, Mohammad bin Abdullah Al-Jadaan, said the government will look to expand private sector opportunities in infrastructure projects, to overcome the negative effects associated with the global COVID-19 pandemic.

The government has also raised the Public Investment Fund’s (PIF) investment capacity by SAR 150 billion, which was transferred from Saudi Arabian Monetary Authority’s (SAMA) FX reserves in March and April.

While FX flows are on average within historical norms, a noticeable decline in FX reserves is due to the transfer, as PIF investments do not appear on SAMA’s published data, the minister said.

The funds are crucial as PIF will take advantage of a number of investment opportunities that have arisen during the current global financial markets volatility. PIF will help diversify and promote economic growth and maximise the return on assets of the kingdom.

Experts in the Saudi government are also eyeing opportunities in the areas of health, security, energy, economics, finance, human resources, commerce, and other sectors.

“These teams assess periodically and comprehensively the health, social and economic dimensions of options for reopening economic activities,” the minister said.

Saudi Arabia, as the president of the G20 group this year, is also pushing for more infrastructure development to revive the global economy hurt by the pandemic.

In June, a G20 Infrastructure Working Group (IWG) met virtually to discuss the Infratech Agenda, which provides high-level policy guidance for countries to accelerate the adoption of technology in infrastructure.

The G20 is collaborating with more than 100 investors, which have a combined USD 20 trillion of assets under management across a wide geographical coverage, to develop a robust infrastructure plan.

“The IWG is advancing work to develop a G20 InfraTech Agenda and promote infrastructure that is resilient against risks, such as from pandemics, to enable us to be better prepared to respond to future crisis,” the group said.
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