Saudi central bank says 2019 GDP growth will not be far from IMF forecast

RIYADH: Saudi Arabia’s economic growth this year will not be too far from the forecast made by the International Monetary Fund (IMF), central bank governor Ahmed al-Kholifey said on Tuesday.

The IMF expects the Saudi economy to grow 1.9%, slower than 2.2% in 2018, but some economists are more bearish due to oil output cuts.

His comments come amid concerns over the impact of Saturday’s attack on Saudi oil facilities that knocked out half the kingdom’s output and damaged the world’s biggest crude oil processing plant, triggering the largest jump in oil prices in decades.

Kholifey said it was too early to comment on the economic impact of the attacks.

Asked if there would be impact on bank’s liquidity, he said that the central bank did expect any shortage in liquidity but it was prepared to support the market if needed.

The Saudi economy remains hostage to hydrocarbon revenues despite an ambitious 2030 economic vision announced by Crown Prince Mohammed bin Salman in 2016 to do the exact opposite.

Oil and gas output continues to account for about 43% of real GDP.

Kholifey said he did expect Aramco IPO to have an impact on the liquidity in the banking sector, as all indicators remain healthy, adding that loan to deposit ratio remains at 78% while the limit is 90%.