Saudi fourth-quarter GDP expands 3.59%, gets boost from oil sector

‘The oil sector led the recovery in the final quarter, reflecting stronger production’, said Monica Malik, chief economist at Abu Dhabi Commercial Bank. (AFP)
Updated 31 March 2019

Saudi fourth-quarter GDP expands 3.59%, gets boost from oil sector

  • ‘The oil sector led the recovery in the final quarter, reflecting stronger production’
  • The Saudi economy has suffered in recent years because of low oil prices and austerity measures

DUBAI: Saudi Arabia’s economy grew in the fourth quarter of last year at its fastest rate since early 2016 due to an expansion in the oil sector, while non-oil growth was sluggish, statistics agency data showed on Sunday.
Fourth-quarter gross domestic product grew by 3.59 percent from a year earlier. In the third quarter, annual growth was 2.5 percent.
“The oil sector led the recovery in the final quarter, reflecting stronger production, particularly at the beginning of the quarter,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank.
The Saudi economy has suffered in recent years because of low oil prices and austerity measures aimed at reducing a huge budget deficit.
In 2017, the economy shrank for the first time since the global financial crisis almost a decade earlier.
“We expect the headline growth figure to moderate in 2019 as Saudi implements oil production cuts,” Malik said.
Saudi Arabia’s economy grew by 2.21 percent in 2018, government data showed in January, without breaking down fourth-quarter figures.
Last week, state-owned Saudi Aramco announced it had agreed to buy a majority stake in Saudi Basic Industries Corp. (SABIC) from the Saudi sovereign wealth fund, Public Investment Fund (PIF), for $69.1 billion.
The deal could boost economic growth as the sovereign fund gains more firepower to proceed with its plans to create jobs and diversify the largest Arab economy beyond oil exports.
Dubai-based Arqaam Capital said in a research note on Sunday the acquisition is expected to boost credit growth, “as corporate activity on increased award momentum continues to improve particularly toward the end of the year and potentially on loans from Aramco to fund the purchase of SABIC.”
Malik said economic growth in 2019 would be impacted by how the PIF implements investments.
“Our assumption is that the SABIC sale will boost PIF’s investments in the second half of the year,” she said.


Arab News recording exposes Nissan lawyer’s lie on IMF bailout for Lebanon

Updated 01 June 2020

Arab News recording exposes Nissan lawyer’s lie on IMF bailout for Lebanon

LONDON: Arab News has published the recording of an interview with a Nissan lawyer after he denied saying that a bailout of Lebanon by the International Monetary Fund (IMF) was linked to the extradition of fugitive tycoon Carlos Ghosn.

The former Nissan chairman fled to Beirut in December from Japan, where he faced charges of financial wrongdoing.

In a story published in Arab News Japan on Saturday, Sakher El Hachem, Nissan’s legal representative in Lebanon, said the multibillion-dollar IMF bailout was contingent on Ghosn being handed back to Japan. 

The lawyer said IMF support for Lebanon required Japan’s agreement. Lebanese officials had told him: “Japan will assist Lebanon if Ghosn gets extradited,” the lawyer said

“For Japan to agree on that they want the Lebanese authorities to extradite Ghosn, otherwise they won’t provide Lebanon with financial assistance. Japan is one of the IMF’s major contributors … if Japan vetoes Lebanon then the IMF won’t give Lebanon money, except after deporting Ghosn.”

On Sunday, El Hachem denied making the comments. “The only thing I told the newspaper was that there should have been a court hearing on April 30 in Lebanon, but it was postponed because of the pandemic,” he said. In response, Arab News published the recording of the interview, in which he can be clearly heard making the statements attributed to him. 

Japan issued an arrest warrant after Ghosn, 66, escaped house arrest and fled the country.

Now listen to the recording: