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Saudi Non-Oil Economy to Witness Fast Recovery With Resumption of Normal Life

Saudi Non-Oil Economy to Witness Fast Recovery With Resumption of Normal Life

Wednesday, 1 July, 2020 - 12:15
Riyadh- Mohammed al-Ayed

SAMA Management Governor Dr. Ahmed Abdulkarim Al-Kholifey said that the Saudi non-oil sector would witness a fast recovery after the total lifting of the lockdown and the resumption of normal life.

He noted that statistics conducted during the first two weeks after the reopening of economic activities have highlighted positive indicators, calling on the Saudis to take advantage of the available banking facilities to boost the Kingdom’s economic sector.

Speaking during a virtual conference on the “required policies to promote economic recovery”, the Saudi central bank governor emphasized that the expectations of SAMA were “less pessimistic” than those expressed by the International Monetary Fund (IMF), but added that some threats could deter a speedy economic revival, including new waves of the coronavirus disease.

While the IMF expected the Saudi economy to shrink by 6.8 percent in 2020, Kholifey emphasized that the statistics conducted by SAMA have highlighted more optimistic estimates.

He added that ongoing meetings were held between the Kingdom’s concerned bodies to monitor the situation of the local economy, especially with the implementation of the amended VAT, which was increased from 5 to 15 percent.

The central bank governor valued the measures taken by the Saudi authorities since mid-March, including loans and banking facilities to the SMEs, as well as other financing projects.

He said SAMA was encouraging commercial banks to lend more to support businesses during the downturn and that banking indicators were reassuring, with banks’ coverage for loans at over 140 percent in the banking sector.

Jihad Azour, director of the IMF’s Middle East and Central Asia Department, said that Gulf countries have succeeded in implementing an effective management strategy in the face of the pandemic, which contributed to mitigating the consequences of the virus in the region and reducing the number of deaths compared to other countries of the world.

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