The World Bank confirmed that Saudi green initiatives will grow the region's economy to $13 trillion by 2050. This came at a time the international financial institution projected a growth of 6.9% for Gulf Cooperation Council (GCC) economies in 2022.
“Saudi Arabia helps us provide financing to the world's poorest countries and advances the global development agenda, at a time when the global economy is still suffering from destabilizing shocks,” World Bank Country Director of the GCC Issam Abousleiman told Asharq Al-Awsat.
“Before the outbreak of the war in Ukraine, the global economy was on track to achieve a robust recovery from the coronavirus pandemic, albeit unevenly,” noted Abousleiman.
“However, the war is now disrupting supply chains,” he added, explaining that the disruption has been exacerbated by closures in China due to its strict policy to prevent the spread of the coronavirus.
Combined, the war and the closures dealt a serious blow to global recovery.
Abousleiman expected the global GDP growth to slow sharply this year. He predicted a growth of 2.9% in 2022 and 3% in 2023.
According to Abousleiman, Saudi Arabia’s economy is expected to grow 8.3 % in 2022, before moderating to 3.7 % and 2.3 % in 2023 and 2024 respectively.
The oil sector will remain the main driver of this growth despite a more cautious approach to production scheduled by OPEC+. Meanwhile, the non-oil sector will continue its growth path at 4.3 % in 2022.
The strong growth in the oil sector reflects the impact of the voluntary production cut of one million bpd, which the Kingdom decided to implement during the months of February and April in 2021, explained Abousleiman.
He pointed out that the most important factors contributing to growth are the recovery of private consumption, especially as the Kingdom eases all forms of social distancing across the country, in addition to investments and exports.
High oil revenues will be used to increase capital spending, and to generate indirect benefits in the non-oil sectors, noted Abousleiman.
“The World Bank and the Saudi government have had an important partnership and excellent cooperative relationship since the 1970s,” he affirmed.
“It covers a number of vital areas for the development of the Kingdom, including the energy sector, transportation, human development, private sector development, and public financial management.”
“The Kingdom is an increasingly important contributor to the World Bank's concessional financing window, which provides financing to the world’s poorest countries.”
