QNB Capital publishes Saudi Arabia – Economic Insight which is part of a new series of country reports, available on the QNB website (www.qnb.com.qa). This report follows the publication of “Oman – Economic Insight” in April 2011. The reports provide detailed analysis of all key aspects of a national economy, ranging from GDP to the business environment.
They also include QNB Capital’s two year forecasts of the main economic indicators.Building on the success of the Qatar Economic Review, which has for years been the leading annual study on the Qatari economy, the new Economic Insight reports will be extending QNB Capital’s coverage to the rest of the GCC, and then to the wider Middle East and North Africa region. The expansion of QNB Capital’s economic research coverage ties in with the growth in QNB’s banking operations. QNB has an extensive coverage in the Middle East and North Africa Region and beyond, and has a presence in 24 countries through its growing network of branches and associate companies.QNB Capital forecasts that Saudi Arabia’s real GDP will grow by 7% in 2011 and 4.4% in 2012. Meanwhile, high energy prices will mean that nominal GDP will surpass its previous peak in 2008, reaching US$549bn in 2012.QNB Capital expects that both the current and fiscal accounts will record higher surpluses in 2011-12 than they did in 2010. The current-account surplus, which was 17% of GDP in 2010, is forecast to post an average surplus of 26% of GDP in 2011-12. Meanwhile, the government budget surplus is expected to average 12% of GDP, despite major increases in public spending plans.
QNB Capital forecasts a pick-up in inflation to 6.1% in 2011 due to rising rental costs and imported inflation from higher global food and commodity prices. House building and slower price growth in international commodities will lead to a deceleration in inflation to 4.4% in 2012.