DAVOS: Saudi Arabia is a “bright spot” for a global economy facing a slowdown this year, a panel of Saudi finance experts and ministers said at the World Economic Forum in Davos on Wednesday.
Finance Minister Mohammed Al-Jadaan said the Kingdom had predicted the global inflation trend earlier than other countries, meaning it was able to take steps to insulate itself.
“Because of the stimulus packages that the world has put into the global economy, in July 2021 we saw the signs and realized that we needed to take action to protect the Saudi economy, and we have done that successfully,” he said.
He added that freezing local energy prices was among the mitigation measures.
While world inflation is above 8 percent, Saudi Arabia’s average is 2.6 percent. Forecasts show that inflation in the Kingdom “will not be as high” in 2023, the minister said, adding: “A lot of work is being done to insulate the Saudi economy but also to help the world economy.”
He said that the Kingdom is changing the way it provides assistance to allies. “We used to give grants and direct deposits with no strings attached, and we’re changing that.”
Panelists pointed to the long-term focus of Vision 2030 as a contributing factor to the resilience of the Kingdom’s economy.
The vision, they said, helped Saudi Arabia adapt as it faces global challenges such as COVID-19, the Ukraine-Russia war, rising inflation, and food and energy insecurity.
Kristalina Georgieva, managing director of the International Monetary Fund, said Vision 2030 had made Saudi Arabia a “bright place for the global economy and its own region at a particularly difficult time for the world.”
The Kingdom, he said, would provide the economic growth the world needed as a global slowdown was expected to linger in 2023 due to the Russia-Ukraine war and the latest COVID-19 emergency in China.
He said Saudi Arabia had an effective fiscal policy, had addressed energy and food insecurity, and was striving for a more diversified economy.
“I don’t know how many countries during this difficult time had the courage to increase their debt-to-income ratio from 6 to 15 percent. Saudi Arabia did it,” he added.
“Saudi Arabia takes its good fortune very seriously to play an important role in energy and food security and to address the incredible debt challenge.”
Relations between the United States and Saudi Arabia
Finance Minister Al-Jadaan said the Kingdom aims to “bridge the gap” and encourage communication with the US and Europe for the “benefit of the world” and find collective solutions to food and energy insecurity and the transition to green energy.
China was “very important” to the Kingdom and its largest trading partner, “but also the United States is a very important and strategic partner.”
“Our goal is to really bridge the gap, our goal is to be a communication force, and we’re fostering communication, whether it’s in China, the US, or elsewhere. We are playing our role globally and you can count on Saudi Arabia to continue.”
Princess Reema Bandar Al-Saud, Saudi Arabia’s ambassador to the US, said maintaining the longstanding strategic partnership between Riyadh and Washington was “more than critically necessary” for global stability.
“Yes, there was a moment of conflict and disagreement, but that does not take away from the fact that we are strategic allies and friends, and this relationship is critical to the world,” Al-Saud said.
gender reforms
The IMF’s Georgieva said that increasing female labor participation was a key driver of the economy, and that Saudi Arabia had already surpassed its own 2030 target of 30 percent of the labor force by seven percentage points. of the country was female.
Abdullah Al-Swaha, Saudi Arabia’s IT and Communications Minister, said Saudi Arabia jumped from 7 percent female participation in technology to 32 percent, which is higher than the EU, G20 and Silicon Valley averages. “It is the boldest, boldest reform story of the 21st century,” he said.
Ambassador Al-Saud said that female empowerment was at the bottom line of the Saudi Vision 2030 design.
“Today, women have equal pay in the Kingdom. Today they have the same opportunities,” Al-Saud said.
He said that society had changed: women held high positions in Saudi Arabia, female participation in sports had increased, and five female diplomats represented the Kingdom around the world.
“Women were not an afterthought in designing what we were doing now,” adding that “we cannot have a sustainable economy if 50 percent of our society is not included.”
