RIYADH (The Thursday Times) — Saudi Arabia’s Vision 2030 initiative has been instrumental in driving social and economic reforms, including a sharp rise in female labour participation. The World Bank notes that female participation in the workforce increased from 22% in 2016 to 34% by the end of 2023. This growth aligns with the Kingdom’s broader strategic goals of promoting gender equality and creating job opportunities across diverse industries.
Reforms in labour laws, aimed at eliminating employment discrimination, have played a significant role in fostering a more inclusive job market. The rapid expansion of opportunities for women has further contributed to this rise, highlighting the Kingdom’s commitment to modernising its economy.
Saudi Arabia’s growth projections exceed IMF estimates
Saudi Arabia’s robust economic outlook extends beyond the World Bank’s forecasts. In September, the International Monetary Fund (IMF) predicted that the Kingdom’s economy would grow at a rate of 4.7% by 2025. However, the World Bank’s updated projection of 4.9% demonstrates the increasing optimism surrounding Saudi Arabia’s economic future, particularly as oil production cuts are phased out, which is expected to bolster growth further.
A separate report by global credit rating agency S&P Global also supports this positive outlook, forecasting a 1.4% GDP growth for 2024, which could rise to 5.3% in 2025. S&P Global credits Saudi Arabia’s diversification strategy, which focuses on strengthening the non-oil private sector and reducing reliance on crude oil revenues, for this expected economic expansion.
Wider regional economic outlook and challenges
The World Bank also provided insights into the broader economic outlook for the Middle East and North Africa (MENA) region. The GDP of the entire region is expected to grow modestly in the coming years, with 2.2% growth projected for 2024 and 3.8% by 2025.
Within the GCC, Saudi Arabia remains the leading economy, with strong fundamentals underpinning its projected growth. Other GCC countries, including Qatar, the UAE, Bahrain, and Oman, are also expected to experience positive economic expansion in 2025, though at varying rates.
Despite this growth, the MENA region faces ongoing challenges due to political instability and conflicts. The World Bank cautioned that economic growth remains subdued in conflict-affected areas, particularly in Lebanon, Syria, and the Palestinian territories, where economic conditions have deteriorated significantly.
Female labour participation remains a critical area of focus for MENA
Despite the progress seen in Saudi Arabia, the MENA region continues to face substantial challenges in terms of female employment. The World Bank’s report emphasised that MENA has the lowest women’s employment ratio globally, at just 19%. The organisation noted that closing gender gaps in employment could result in a significant increase in per capita income across the region.
The report also highlighted the importance of shifting more talent from the public to the private sector to unlock productivity gains. Public sector employment remains disproportionately high, particularly among women, but the private sector’s modernisation and expansion hold the key to fostering long-term economic growth.
The role of digitalisation and trade in boosting economic growth
The World Bank identified digitalisation and international trade as crucial drivers for economic growth in the MENA region. By leveraging technology and capitalising on the region’s strategic geographic position, countries like Saudi Arabia can further stimulate innovation and growth. Improving data transparency and quality was also cited as a critical area for improvement.
