The International Monetary Fund mission chief for Saudi Arabia said that the Saudi public debt issuance (Sukuk and bonds) will keep on attracting international investors.
Assistant Director in the IMF’s Middle East and Central Asia Department Timothy Callen pointed to the decrease in the public debt to GDP ratio in the Kingdom, which is estimated to reach a maximum of 30 percent of the GDP by 2020 according to the announced plans.
Callen said in a press conference that was held online on Tuesday that he is confident that “Saudi Arabia’s debt will remain attractive under international standards, in light of the strong financial budget with the state-owned assets in the Public Investment Fund Foundation.”
Saudi Arabia is planning to issue debts (bonds and Sukuk) that can reach a maximum of 30% of the Saudi GDP, i.e. about 450 billion riyals up until 2020.
Callen said that the fund is looking forward to witnessing “the huge impact of the transformation and reform program in the kingdom, which would give a greater role to the private sector in diversifying the country’s sources of income and creating employment opportunities.”
He expects a “2% growth rate in the Saudi non-oil sectors in 2017 and a deficit that is less than 10% from the current budget of the kingdom”.
He talked about the high expectations of the Fund, regarding the decrease in the government spending during the current year compared to the previous two years and stressed on the importance of making gradual and systematic modifications to reach a balanced budget in 2020.
He also talked about the expectations of the Fund regarding the increase in the oil revenues despite the pledge to reduce oil production in the Kingdom.
He believes that the Kingdom’s budget for the current year allocated to important sectors, will help in granting a greater role to the private sector, highlighting the need to “focus on education and training, in partnership with the private sector.”
He said that the “transformation and reforms program will address the unemployment problem,” referring to the 12% rate of unemployment among Saudi youth, adding that the government is implementing plans to create new job opportunities.SHOW MORE