Riyadh – Mubasher: Saudi economy is expected to increase by 2.2% year-on-year during 2018, according to a recent report by the National Bank of Kuwait (NBK).
The Kuwaiti lender ascribed its forecast to a rise in the kingdom’s oil production, along with the recovery of domestic demand, the report added.
Saudi non-oil sector is also projected to level up 1.9% this year, helped by major investments that will be implemented in the private sector, in addition to thegovernment’s expansionary budget that will be used in economic expansions.
The Kuwaiti bank forecast that Saudi inflation will drop to 1.8% by 2019 as the impacts of imposing the value added tax (VAT) will start to wear off.
On a related note, the report further indicated that the oil-rich nation’s fiscal deficit is projected to reach 4.6% by the next year, down from 9% in 2017, while government debt is forecast to hit 24.5% of GDP next year.
“The contribution of non-oil revenues, however, will continue to increase as the authorities capitalise on recently-added taxes such as the VAT, excise tax and the expat/expat dependents levy, which will increase again this year,” the report found.
