It highlights the great progress made by the Kingdom in its ‘investment and business climate’ over the past two years Efforts to provide more jobs for Saudis and diversify the economy raised some concerns in the annual Investment Climate Statements DUBAI, RIYADH: In its recently published annual Investment Climate Statements on more than 170 countries, the US State Department highlighted the achievements made by Saudi Arabia in improving its ranking on a number of global lists. “In recognition of the progress made in its investment and business climate, Saudi Arabia’s rankings on several world indexes improved between 2019 and 2021,” the State Department said. The country-specific Investment Climate Statements, which are prepared by economic experts in US embassies and other posts around the world, provide an analysis of economies that are or could be lucrative markets for US businesses of all sizes. The list of indexes on which the State Department noted the Kingdom has made progress in recent years includes the World Competitiveness Yearbook, an annual report published by the International Institute for Management Development in Switzerland. The Investment Climate Statements credited Saudi Arabia with achieving the biggest improvement of any country, after it moved up 13 places on this index in 2019 and two more in 2020 as a result of “improvements to government and business efficiency.” The State Department also highlighted the Kingdom’s improved ranking on World Bank’s Doing Business 2020 report, describing Saudi Arabia as “the world’s top reformer and improver.” However, it also raised concerns that efforts to provide more jobs for Saudis and diversify the economy to reduce the reliance oil have prompted the government to take steps that might weaken the investment climate going forward. There were also concerns about the fiscal balance as a result of falling oil prices and the Kingdom’s response to the COVID-19 pandemic. Independent experts played down these fears. Opinion Dr. Mohamed Ramady NAZAHA: Saudi Arabia’s assurance for foreign investors Author Read article “The Saudi government is prioritizing investments in upscaling Saudis’ skills in key economic sectors, leading to more sustainable non-oil economic growth, which will create more opportunities for foreign investors,” said Mohamed Ramady, an independent economist in London. The activities of the Oversight and Anti-Corruption Authority (Nazaha) will further benefit expenditure on government projects by removing the hidden cost of corruption and creating a level playing field for domestic and international investors, he added. As a result, Ramady said, the less optimistic aspects of the State Department’s assessment of the future of the Saudi economy seem a bit “unrealistic” as there are significant positive trends that support a stronger economic picture. “The local Tadawul stock market has broken through the psychological 11,000 level for first time, reflecting a better performance than most other regional markets, which saw negative returns,” he said. “Saudi oil production rose by 4.5 percent in June and is expected to continue rising until end of the year, in line with the recent OPEC+ agreement, with exports up, leading to increased central bank reserves that rebounded in June by $8.8 billion." Mazen Alsudairi, head of research at Al-Rajhi Capital in Riyadh, said: “The Saudi budget deficit is expected to narrow to 108 billion riyals ($29 billion) based on International Monetary Fund estimates, while we are expecting it to be 80 billion riyals. “These views are supported by the Fitch upgrade of Saudi outlook from ‘negative’ to ‘neutral’ in consideration of the Saudi budget, the foreign reserves and the structural reforms.”