Riyadh - Mubasher: Capital Economics forecasts that Saudi economy will return to growth next year, achieving a growth rate between 0.8% and 1.3% in 2018 and 2019, according to a report issued on Monday.
However, the research firm said that the recovery will be slower than previously expected due to cutting subsidies, and applying the value-added tax (VAT), which is set to increase inflation.
The recession in Saudi Arabia deeply emerged in the third quarter of 2017, due to the fall of oil prices, the report noted.
Oil sector’s effects on the Saudi economy should perish in 2018, even if the Organization of the Petroleum Exporting Countries (OPEC) decided to extend the production cut deal.
On a more positive note, the report noted that non-oil growth showed a rise in the recent period, supported by a decline in non-oil imports in the three-month period that ended in September.
