“Capital Economics” expected that the Saudi economy will grow by 10 percent this year.
These expectations come against the backdrop of the Saudi economy’s growth figures for the first quarter, which indicated an increase of 9.6 percent on an annual basis, the best growth reading since 2011.
Capital Economics believes that this strong performance of the economy will continue for the rest of 2022, against the backdrop of high oil prices and expectations of adopting a more flexible fiscal policy.
“The combination of higher oil production and the growing possibility of a more flexible fiscal policy supports our above-consensus forecast for the kingdom’s economy to grow by 10 percent in 2022,” it added.
According to the company, the Kingdom’s oil production reached 10.35 million barrels per day in April, which translates to an increase of more than 27 percent year on year, which is the fastest pace of production increase since March of 2003.
The non-oil sector
The non-oil sector plays a pivotal role in the Saudi economy. It saw a 2.5 percent growth as the economy continued to move toward a full reopening after the Covid pandemic.
An earlier report from Capital Economics also indicated that the non-oil sector has rebounded strongly since the end of the Omicron wave in January 2022.