A H M E D A . A L K H O L I F E Y
E X E C U T I V E D I R E C T O R F O R S A U D I A R A B I A A T T H E
I N T E R N A T ...
Stability
 Stable Political System.
 Predictable Economic Policies:
 Consistent, credible, and clear policy messages.
...
Global Role
 Systemic Role of Saudi Arabia:
 Positive spillover effects of policies pursued by Saudi Arabia
 Ensuring s...
Growth
 Real GDP*
 Non-Oil GDP
2009 2010 2011
Saudi Arabia 0.1 4.1 6.5
World Output -0.7 5.1 4.0
Advanced Economies -3.7...
Fiscal Policy
Consistent & countercyclical
Priorities:
Investment in infrastructure.
Investment in human capital
Competiti...
Government Spending
Education
and
Training
41%
Health and
social
Affairs
19%
Municipalities
6%
Transport
& Telecom
7%
Wate...
Promotion of Finance
•finances large scale government and
private projectsPIF (1971):
•finances real estate sectorREDF (19...
Conclusion
 Attractive business environment:
 Promising growth potentials
 Low tax rate (max. 20%) and business friendl...
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Business Forum: Finance and Investment - Alkholifey

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Presentation at the US-Saudi Business Opportunities Forum (Dec 5-7, 2011, Atlanta, GA). Dr. Ahmed Alkholifey, Executive Director for Saudi Arabia, IMF, presented at the panel titled, "Opportunities for Finance and Investment".

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Business Forum: Finance and Investment - Alkholifey

  1. 1. A H M E D A . A L K H O L I F E Y E X E C U T I V E D I R E C T O R F O R S A U D I A R A B I A A T T H E I N T E R N A T I O N A L M O N E T A R Y F U N D Finance and Investment in Saudi Arabia: The Role of Fiscal Policy 1
  2. 2. Stability  Stable Political System.  Predictable Economic Policies:  Consistent, credible, and clear policy messages.  Well-Supervised Financial Sector:  Well capitalized and highly profitable banking sector.  Attractive Business Environment. 2
  3. 3. Global Role  Systemic Role of Saudi Arabia:  Positive spillover effects of policies pursued by Saudi Arabia  Ensuring sustainable supply and stability of energy markets.  The G20:  Framing the new path for strong, sustainable, and balanced growth. 2005-2009 2009 2010 Imports (% of GDP) 20.0 23.0 21.6 Remittances (bln. SR) 340.7 94.4 98.2 3
  4. 4. Growth  Real GDP*  Non-Oil GDP 2009 2010 2011 Saudi Arabia 0.1 4.1 6.5 World Output -0.7 5.1 4.0 Advanced Economies -3.7 3.1 1.6 Emerging and Developing Economies 2.8 7.3 6.4 *IMF World Economic Outlook, Oct 2011 2005-2009 2010 2011 Saudi Arabia 4.6 4.9 5.4 GCC 3.6 4.5 5.3 4
  5. 5. Fiscal Policy Consistent & countercyclical Priorities: Investment in infrastructure. Investment in human capital Competitiveness: Enhancing productivity of physical and human capital 0 50 100 150 200 250 0 50 100 150 200 250 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 Hydrocarbon Revenue Government Expenditure Government Hydrocarbon Revenue and Total Expenditure, 1980–2010 (In U.S. dollar billions) 5
  6. 6. Government Spending Education and Training 41% Health and social Affairs 19% Municipalities 6% Transport & Telecom 7% Water, Agriculture , and Infrastructure 14% Specialized Credit Institutions 13% 2011 Appropriations* for the main development sectors *Projections 346 393 466 520 597 626 580* 2005 2006 2007 2008 2009 2010 2011 Government expenditures (Billion SR) *Projections 6
  7. 7. Promotion of Finance •finances large scale government and private projectsPIF (1971): •finances real estate sectorREDF (1974): •finances industrial projectsSIDF (1974): •provides interest-free loans for small and emerging businesses and professions SCB (1971): •finances farmers and agricultural projectsADF (1962): •Extends credit to private sector entities for the purposes of establishing development projects. (SR 7.0 Billion) Direct Loan Program (1971): 7 0 20 40 60 80 100 120 ADF SCB PIF SIDF REDF 5 yr total 2.2% 18.7% 37.8% 19.9% 20.9% 117.5 (bil SR) Total loans and share of SCIs during 2006-2010
  8. 8. Conclusion  Attractive business environment:  Promising growth potentials  Low tax rate (max. 20%) and business friendly tax administration.  Large economic size  Supportive economic policy including good finance terms 8
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