Saudi Arabia has been one of the best performing G20 economies in recent years, and has been supporting the global economy through its stabilizing role in the global oil market.
The International Monetary Fund (IMF) also has acknowledged Saudi Arabia’s role as an important source of financial assistance and remittances for many developing countries. Saudi Arabia has been commended as well for providing generous financial support to countries in the Middle East region.
It is said that prudence, adequate regulation and management of public finances have provided Saudi Arabia with the right tools, guided by an important principle: Save in the good days and spend a portion in the bad ones.
Amid these positive Saudi developments, comes the news of an unprecedented commitment by the G20 ministers in Sydney to boost global growth by more than $2 trillion over the next five years, which bodes well for the world economy that has sputtered since the 2008 financial crisis.
The centerpiece of the G20 commitment is to boost the combined gross domestic product of G20 countries, representing about 85 percent of the global economy, by 2 percent above the levels expected for the next five years, possibly creating tens of millions of new jobs. World GDP was about $72 trillion in 2012.
The G20 commitment provides a tremendous opportunity to Saudi Arabia to boost growth and raise standard of living further as its population is young and increasingly well-educated, and as it continues to enter into the labor market. As the government gradually diversifies from oil, a strengthened culture of entrepreneurship is also developing in Saudi Arabia, which will give a major boost to nonoil GDP.
IMF said Saudi economy grew by 5.1 percent in 2012, benefiting from high oil prices and output, strong private sector growth and government spending.
After all, Saudi Arabia’s economy continues to be strong as is reflected in its annual growth rate of 3.1 percent in Q3, 2013, after posting a growth of 2.1 percent in Q1 and 2.7 percent in Q2.
Thus, all eyes will be on Brisbane to see what direction the word economy will take in the coming five years as each G20 country will present a comprehensive growth strategy to a summit of leaders scheduled for November.