Economic reforms and growth
It is familiar that the entire reforms of the national economy will be completed in 2020, topped by the National Transformation Program at the level of twenty-four state bodies based on the economic and development sectors in the first year of the Program. The Program contains strategic objectives related to interim targets to 2020, and a number of initiatives which have been launched to achieve these goals and targets. There is no doubt that any change or development at any level leads to some negative consequences. Yet, the hard work and the goal clearly exceeds this aptly, a matter which is confirmed in the experiences of lots of countries that have turned into super-industrialized countries
Despite the period of time that we need to reach the ready stage for our economic sectors (2020), the annual growth of the GDP was achieved after the year of deflation, when inflation rates were negative, which means the phase of stagnation. However, the national economy recorded, for the first time, a growth of 1.2% during the first quarter of this year. This means that the economy is out of the economic effects of the low oil prices and some structural reforms.
The striking thing about this phase of the year is the growth of the non-oil sector at a rate of 1.6% - in addition to the oil sector- and this important growth, particularly in the industry, mining, government services and financial services, undoubtedly reflects a promising state of recovery by the national economy after the slowdown phase in 2017, as a result of the broad reforms of the entire development sectors.
Without doubt, the great reforms and developments in the financial sector, especially in the Saudi Stock Market and including them in the MSCI for the emerging markets, are a step that will be reflected on the national Saudi corporations which will be motivated to introduce them into the market and polarize foreign capital.
In contrast, the deflation of some sectors such as wholesale and retail trade, hotels and restaurants has been still expected as a result of the reforms that focus on rationalizing expenditure by rationing subsidies for energy prices and applying the value-added tax.