[ad_1]
Consensus estimates of economic growth and budget deficit gap estimates
SOURCE: -Riyadh.directory – SPA
The Saudi Finance Ministry has confirmed its agreement with the International Monetary Fund's outlook for economic growth in the medium term, but disagrees with other estimates included in the Fund's report, such as "budget deficit estimates". for 2019 and the following years ", thereby confirming the ministry's commitment to achieving the program's objectives. Medium-term financial balance. "
Commenting on the declaration of the Article IV consultation report, Saudi Finance Minister Mohammed al-Jadaan said the IMF report reaffirmed the Kingdom's tangible progress through the implementation of many reforms. planned in accordance with the programs to achieve the Kingdom's Vision 2030, in particular those related to the fight against corruption and money laundering. And the financing of terrorism ".
Al-Jadaan explained that "the majority of the recommendations of the 2019 Article IV consultation report are consistent with the measures taken by the Government to ensure financial sustainability in accordance with the best practices adopted by the Government of Japan. global, including continued progress in reforms aimed at improving the efficiency of public financial management and the pursuit of financial stability and growth rates.
The Ministry of Finance welcomed the report on the Kingdom's Article IV consultation for 2019, in which it welcomed the progress made by the Kingdom in implementing its reform program to support diversification of the economy, inclusive growth and job creation, underlining that the Kingdom continued to implement reforms aimed at strengthening the legal framework and improving the business climate. .
The recent IMF report showed that the government's structural reforms included the following sectors: financial markets, foreign investment, the legal framework, trade and SMEs.
The report highlighted the continued recovery of the non-oil economy, where it hoped to accelerate growth rates to 2.9% in 2019, supported by positive economic indicators since the beginning of the 1990s. the year, noting that rising public spending and increased confidence in the economy supported economic activity and, at the same time, the impact of the output of the economy. employment. Expats on economic growth will be limited.
Growth rates in the non-oil sector will continue to improve in the medium term to around 3% to 3.2% over the next few years as economic reforms continue.
The power of mortgage credit
The report referred to the decline in the unemployment rate of citizens to 12.5% in the first quarter of 2019 and the improvement in credit growth as a result of the recovery of credit activities in the construction and construction sectors. of the manufacturing industry. Banks enjoy a good position and strength in the growth of mortgage credit, as well as the size of the reserves. The Saudi Monetary Agency (SAMA), which is already high in relation to the IMF's International Monetary Fund (IMF) reserve adequacy assessment measure, predicts that the initial non-export-led deficit oil will fall.
The report stresses that programs to realize the vision behind the 2030 vision of the Kingdom have moved from the design phase to the implementation phase and that the economic and social reforms that support growth and development have become a reality. Employment of citizens are beginning to have a positive impact on the economy.
The IMF report welcomed the progress made through the reforms that have contributed to strengthening the fiscal framework, strengthening its risk analysis, strengthening the budget process, developing a medium-term fiscal framework, and putting in place a system of budgeting. online expense management (accreditation). Rapid progress in financial market and domestic debt market reforms, noting that these reforms have resulted in the Kingdom's inclusion in the global equity and bond market indices this year.
The report welcomed ongoing measures to improve the governance and anti-corruption framework and strengthen the AML / CFT framework, stressing the importance of pursuing reforms in these areas, while calling for more efforts to strengthen budget controls to reduce risks in the medium term.
Financial stability
The report pointed out that the government had implemented many of the recommendations contained in the 2018 Article IV Consultation Report and the 2017 Financial Sector Stability Assessment Report. noting that the recommendations implemented included the pursuit of reforms aimed at developing non-oil revenues and increasing the volume of bank loans to SMEs.
While the report estimated that fiscal consolidation reforms, additional fiscal measures and improved expenditure management were needed to restore precautionary financial margins and reduce risks in the medium term, he welcomed the fact that 39, improving the quality of economic data and the approval of the new system of competition and government procurement.
The report welcomed efforts to increase access to financial services as part of the financial sector development program and felt that the exchange rate peg to the US dollar remained the best option for the financial sector. Kingdom because of the structure of its economy.
[ad_2]
Source link
