Saudi non-oil exports rise 26.7pc in June
RIYADH, September 2, 2018
Saudi Arabia's non-oil exports rose for the 9th month in a row, up by 26.7 per cent year-on-year in June 2018 (+14.3 per cent y-o-y in May 2018), whereas the non-oil imports dropped 3.2 per cent y-o-y in June (-6.4% y-o-y in May 2018), said a report.
Meanwhile, the Index of Industrial Production (IIP) climbed 0.6 per cent quarter-on-quarter in Q1 2018, supported by the rise in ‘Manufacturing Industry’ sector (constituting ~23 per cent of the total index). However, the remaining sectors ‘Mining and Quarrying’ and ‘Electricity Supply’ witnessed a drop, said the Al-Rajhi Capital research report, quoting from a Saudi Monetary Agency (Sama) report.
Saudi Arabia's oil revenue is expected to reach SR605 billion ($161.36 billion) against budgeted SR492 billion this year as the kingdom witnesses a continuous improvement in the economy, the Al-Rajhi Capital report said.
With budgeted non-oil revenue of SR291 billion, the fiscal deficit is expected to be SR82 billion for 2018 (~58% lower than government budget deficit estimate of SR194.7 billion), it said.
"We continue to believe that steady oil prices and higher oil output coupled with better non-oil growth will aid the kingdom’s economic recovery this year," the report said.
Quoting from Saudi Monetary Agency's (Sama) data, it said credit to the private sector climbed for the fourth consecutive month (+0.7% y-o-y; +0.2% m-o-m) in July, while bank claims to the public sector also witnessed a rise (+24.2% y-o-y; +0.9% m-o-m).
Further, consumer spending continued to improve with POS transactions (+25.3% y-o-y; -0.6% m-o-m in July) and ATM withdrawals (+12.7% y-o-y; +2.4% m-o-m) witnessing a steady rise on annual basis.
Meanwhile, the Sama foreign reserves have recorded the highest annual growth in over three-and-half years (+1.4% y-o-y; -1.0% m-o-m) in July, as higher oil revenue and recent debt issuances have curbed the government’s need to tap its reserves to plug the fiscal deficit.
Saudi Arabia’s H1 2018 fiscal deficit narrowed to SR41.7 billion compared to SR72.7bn in H1 2017. For 1H 2018, revenue jumped ~43% y-o-y to SR439.9 billion, supported by a sharp increase in both oil (+40% y-o-y) and non-oil revenues (+49% y-o-y). Meanwhile, expenditure grew by 26.5% y-o-y to SR481.5 billion.
Meanwhile, government reserves with Sama stood at SR597.8 billion (including government current account) as of July 2018, recording a monthly fall of 2.0%.
Credit to the private sector rose 0.7% y-o-y (+0.2% m-o-m) in July, while, bank claims on public sector increased 24.2% y-o-y (+0.9% m-o-m) in the same month. Meanwhile, deposits slipped 1.5% y-o-y (-0.6% m-o-m) in July.
Crude oil prices (Brent October futures contract) gained 4.4% m-o-m in August 2018, backed by the fall in US crude oil inventories. Further, reports suggesting a drop in Iranian output also aided oil prices. Meanwhile, crude oil production increased 2.2% m-o-m, to 10.7 mbpd in July 2018, compared to the rise of 4.5% m-o-m in June. - TradeArabia News Service
