RIYADH: The most recent World Economic Outlook published by the International Monetary Fund projects that Saudi Arabia’s real gross domestic product would expand by 3% in 2025 and then by an additional 3.7 percent in 2026. In comparison to the IMF’s January prediction, the forecast represents a lower adjustment of 0.3 percentage points for 2025 and 0.4 percentage points for 2026. The Kingdom is expected to outperform the world average, which the IMF projects will be 2.8 percent in 2025 and 3 percent in 2026, notwithstanding the little adjustment.
The IMF stated in its report that “global economic activity is expected to be significantly impacted by the rapid escalation of trade tensions and extremely high levels of policy uncertainty.” Saudi Arabia is anticipated to fare better regionally than a few of its Gulf neighbours. According to IMF projections, Bahrain’s GDP is expected to rise by 2.8 percent in 2025, with Qatar, Oman, and Kuwait following closely behind with 2.4, 2.3, and 1.9 percent, respectively.
With a growth rate of 4% in 2025 and 5% in 2026, the UAE is expected to top the Gulf Cooperation Council. Additionally, the IMF projects that Saudi Arabia’s inflation would stay under control, with the average annual rate remaining constant at 2.1 percent in 2025 and decreasing somewhat to 2 percent the following year. In a different report published in December, Mastercard Economics predicted that the Saudi economy will increase by 3.7 percent in 2024, mostly due to expansion in non-oil industries.
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