The economic policy of Saudi Arabia’s Monarch, the Custodian of the Two Holy Mosques Salman bin Abdulaziz is expected to be mainly concerned with finding more jobs and executing projects worth billions of dollars in infrastructure to help maintain investor confidence despite the oil slump, said economists.
They also expect the Kingdom to maintain balanced spending on development projects during the rule of King Salman.
The KSA’s state television announced on Friday that King Abdullah has died after almost a decade on the throne. He was born in 1924. Crown Prince Salman bin Abdulaziz was declared his successor.
John Sfakianakis, regional director at Riyadh-based asset management firm Ashmore highlighted the state budget for 2015, which was announced last month and included marginal rise in state spending by 0.6% compared with 2014 budget, which represents the lowest rise in decades and further involves slight decline in spending as per criteria adjusted based on inflation.
However, the government will likely continue with generous spending on jobs and education in order to provide work force that is able to compete. It will also modernize the healthcare system and carry out mega projects like Riyadh metro whose value amounts to $22.5 billion and is scheduled for completion by 2019.
Experts told Al-Eqtisidiya that Saudi Arabia will work on boosting competition in some sectors like aviation and will make the judicial system more transparent as regards commercial cases, in addition to opening the local stock market to foreigners for direct investments this year.
King Salman has skills to push for such reforms, as he was appointed as Prince of Riyadh for more than 40 years during which he worked with technocrats and the conventional to change the capital from a desert area to a major city. When he was Crown Prince, Salman played a pivotal role in managing economy over the few last years, according to the experts.
Monica Malek, chief economist, ADCB, said stability and development will be high on agenda, expecting the capital markets to reflect positively on such reforms.
Sfakianakis expects the equity market to show positive performance thanks to the smooth succession of power.
