Saudi Crown Prince Emphasizes Kingdom’s Commitment to Stable Oil Supplies to Japan

Saudi Crown Prince Mohammed bin Salman holds a video call with Japanese Prime Minister Fumio Kishida on the sidelines of the Saudi Arabia-Japan Vision 2030 Forum. (SPA)
Saudi Crown Prince Mohammed bin Salman holds a video call with Japanese Prime Minister Fumio Kishida on the sidelines of the Saudi Arabia-Japan Vision 2030 Forum. (SPA)
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Saudi Crown Prince Emphasizes Kingdom’s Commitment to Stable Oil Supplies to Japan

Saudi Crown Prince Mohammed bin Salman holds a video call with Japanese Prime Minister Fumio Kishida on the sidelines of the Saudi Arabia-Japan Vision 2030 Forum. (SPA)
Saudi Crown Prince Mohammed bin Salman holds a video call with Japanese Prime Minister Fumio Kishida on the sidelines of the Saudi Arabia-Japan Vision 2030 Forum. (SPA)

Prince Mohammed bin Salman, Crown Prince and Prime Minister of Saudi Arabia, underscored on Tuesday the Kingdom’s commitment to maintaining the supply of crude oil to Japan, pointing to Riyadh’s desire to boost cooperation with Tokyo in other fields, including clean energy.

He made his remarks during a video call with Japanese Prime Minister Fumio Kishida on the sidelines of the Saudi Arabia-Japan Vision 2030 Forum, which witnessed an agreement to announce the Saudi-Japanese Partnership Council.

Kishida expressed his gratitude to the Kingdom for the steady supplies of crude oil to his country, highlighting Saudi Arabia’s leading role in stabilizing the global oil market and supporting global supply chains for clean energy.

The leaders also tackled bilateral economic and investment cooperation in energy and joint investments, research related to the climate initiative, environmental sustainability, environmental protection, and means to reduce the effects of climate change.

Crown Prince Mohammed highlighted the growth of bilateral trade exchange in recent years and the aspiration to work with Japanese companies in a number of promising fields and giant projects, stressing that Japan is Saudi Arabia’s largest investment destination.

Kishida expressed his happiness at handing over the torch of Expo 2025 Osaka, Kansai, to Saudi Arabia in 2030, noting Japan’s effort to encourage further growth in the fields of entertainment, tourism, education and sports.

During the Saudi-Japan Vision 2030 Business Forum in Japan, Saudi Minister of Energy Prince Abdulaziz bin Salman announced that the Kingdom had achieved new global records in reducing the cost of electricity production from wind energy, through the AlGhat and Wa’ad Alshamal projects.

The Saudi Power Procurement Company signed two power purchase agreements with a consortium led by investment conglomerate Marubeni to purchase power from the AlGhat (600 MW) and Wa’ad Alshamal (500 MW) wind projects.

The signing of the two purchase agreements came after a public competition for five bids for each project. Both projects achieved new global records for wind energy projects in terms of the total cost of electricity production.

Oil experts said Saudi Arabia’s new achievements align within the country’s efforts to diversify energy sources, boost its global position in exporting renewable and sustainable energy, as well as increasing its use of clean energy, reducing carbon emissions and preserving the environment in line with the goals of Vision 2030.

They stressed that the Kingdom possesses great capabilities in the production and export of renewable energy, such as wind, solar and hydrogen energy, as well as a suitable investment environment. They pointed to the launch of huge projects worth billions of riyals, and strategic plans that will transform Saudi Arabia into one of the most important countries that export all types of renewable energy.

In remarks to Asharq Al-Awsat, former chief advisor to the Saudi Ministry of Energy Dr. Mohammad Srour Al-Sabban said Saudi Arabia has achieved new world records in reducing the cost of producing electricity from wind energy.

He added that this was a very important step within the roadmap of Vision 2030 and its goals to raise the share of electrical production relying on renewable energy to 50 percent.

This approach will save the amount of liquid feedstock used for electric power generation, which will be liberated from oil and directed for export, in addition to reducing the cost of production in wind energy projects, he explained.

Oil expert Dr. Fahad Mohammed bin Jumah told Asharq Al-Awsat that this achievement will contribute greatly to decreasing the costs of electricity production in Saudi Arabia and achieving the Kingdom’s plans to curb the dependence on gas to about 50 percent.

Meanwhile, the forum saw the signing of more than 30 memorandums of understanding in the fields of energy, manufacturing, and financial activities.

Minister of Energy and Minister of Investment Khalid Al-Falih met with Japanese Minister of Economy, Trade and Industry Ken Saito, who said Saudi Arabia is the largest supplier of crude oil to Japan, and one of the most important partners in energy security.



IMF Praises Saudi Arabia’s Unprecedented Economic Transformation

Efforts to diversify the economy have started to bear fruit: IMF (Asharq Al-Awsat)
Efforts to diversify the economy have started to bear fruit: IMF (Asharq Al-Awsat)
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IMF Praises Saudi Arabia’s Unprecedented Economic Transformation

Efforts to diversify the economy have started to bear fruit: IMF (Asharq Al-Awsat)
Efforts to diversify the economy have started to bear fruit: IMF (Asharq Al-Awsat)

The International Monetary Fund (IMF) has praised Saudi Arabia’s significant economic changes under the “Vision 2030” national transformation plan, noting improvements in public finances and business regulations.
An IMF mission expected non-oil growth in Saudi Arabia to reach around 3.5% in 2024, crediting careful economic policies and major reforms.
The mission also highlighted record-low unemployment rates and controlled inflation in the country, and welcomed recent updates to funding requirements aligned with “Vision 2030” goals.
The IMF released a concluding statement at the end of its official staff visit to Saudi Arabia.
In the statement, the IMF said: “Saudi Arabia’s unprecedented economic transformation is progressing well.”
“Prudent macroeconomic policies, transformative changes—including through fiscal reforms and in the regulatory business environment—and strong domestic demand have helped prop up non-oil growth. Inflation remains contained.”
“Spending reprioritization and recalibration of major spending programs are ongoing. Efforts to diversify the economy have started to bear fruit.”
“Building on these successes, it will be important to sustain the non-oil growth momentum, maintain financial sector stability, continue mitigating risks of overheating, reverse declining total factor productivity and ensure inter-generational equity.”
Economic Activity Remains Robust
According to the IMF, real non-oil growth decelerated from 5.3% in 2022 to a still robust 3.8% in 2023, driven mostly by private consumption and non-oil investment.
While non-oil growth for Q1-2024 indicates some moderation in economic activity— the IMF staff estimated that the output gap remains in positive territory, close to 2% of the non-oil potential GDP.
The statement also noted that the Saudi economy weathered the geopolitical tensions in the Middle East well, thanks to minimal trade and financial exposures to the affected regions and uninterrupted shipments.
Unemployment Rate Reached Historic Lows
In 2023, the Saudi economy added over one million jobs, primarily in the private sector. The overall unemployment rate for Saudis dropped to 7.7% in the last quarter of 2023—inching closer to the 2030 Vision objective of 7%.
Labor force participation rates have remained at historically high levels but relatively flat over the past year for both men and women, albeit with the women’s rate still comfortably exceeding the Vision 2030 goal of 30%.
Headline Inflation Has Decelerated Rapidly
After peaking at 3.4% in January 2023, year-on-year inflation receded to 1.6% in April 2024, helped by an appreciating nominal effective exchange rate.
However, rents are growing at a brisk rate of about 10% amid inflows of expatriate workers and large redevelopment plans in Riyadh and Jeddah.
Wholesale prices have also edged up recently, reflecting an increase in input costs. So far, some uptick has been observed in the wages of high-skilled workers.
Additionally, the current account surplus narrowed significantly.
The decline in the current account surplus from 13.7% of GDP in 2022 to 3.2% of GDP in 2023 mainly reflected lower oil exports and strong growth in investment-related imports.
These were partly mitigated by a record surplus in the services balance, including a 38 percent surge in net tourism income.
The Saudi Central Bank’s (SAMA) holding of net foreign assets reached $423.7 billion in April 2024, which was slightly above the end-2023 level.
Reserves remain ample, representing 15.6 months of imports and 208% of the IMF’s reserve adequacy metric by end-2023.