‎“Bloomberg”: Saudi Arabia is the new China for investors ‎chasing growth

“Bloomberg” said in a report published today, “For international investors who have pursued growth, Saudi Arabia has become like China.” The report states that crowds of advisors wearing Western dress have become a familiar sight in the lobbies of Riyadh’s most luxurious hotels, as Crown Prince Mohammed bin Salman embarks on a multi-trillion-dollar plan to wean Saudi Arabia away from oil. And in recent months, they’ve been joined by another group of the right people: fund managers, eager to get an early foothold in the next big emerging markets growth story.

The report adds, in a second aspect, that Saudi Arabia (the Saudi Stock Exchange) joined the MSCI Emerging Markets Index in 2019, but this system attracted very little of the billions of dollars that stock investors allocate to global stock markets. Fund managers have been frustrated by the lack of liquidity in the Tadawul All Share Index, which limits full ownership by foreigners. However, the report indicates that the stock market rose by more than 11% during 2023, driven by economic reforms in the country, but the representation of the Saudi market in the portfolios of international investors is still below ambition (or incomplete), as described by the “Bloomberg” report.

On the other hand, Standard & Poor’s Global revealed that it expects Saudi Arabia’s economic growth to recover next year to 2.7% in 2024 from a contraction of 0.4% this year.

According to the Arab World News Agency (AWP), Standard & Poor’s added in a report on emerging markets that growth in Saudi Arabia declined this year due to the oil production cuts implemented by the Kingdom within the OPEC+ alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and allies, including Russia. But at the same time, Standard & Poor’s expects growth to improve in the next two years, reaching 3.7% in 2025.