The International Monetary Fund’s (IMF) Article IV Consultation Report has concluded that the medium-term economic outlook in Saudi Arabia is promising, reflecting the Kingdom’s implementation of structural reforms set in Vision 2030.
With a decline in oil prices, the Kingdom has shifted efforts towards achieving non-oil revenue to offset the possibility of economic instability. By the end of 2017, non-oil growth is projected to pick up to 1.7 percent, while the fiscal deficit is expected to decline from 17.2 percent of GDP in 2016 to 9.3 percent of GDP in 2017. The Kingdom will also benefit from further energy price reforms and the introduction of excises taxes and value-added tax (VAT).
According to the IMF, the Kingdom’s fiscal consolidation efforts are beginning to yield positive results and the business environment is beginning to gain momentum.
Under Article IV of the IMF’s Articles of Agreement, the IMF holds bilateral discussions with member countries, usually every year. A team of IMF representatives visits the country, collect economic and financial information, discusses the country’s economic developments and policies with officials, and reports on its findings.