RIYADH: Saudi Arabia’s gross domestic product (GDP) grew by 3.8 percent in 2013, media yesterday quoted Saudi Arabian Monetary Authority (central bank) governor Fahad al-Mubarak as saying.
The International Monetary Fund said last May that it expected growth in the largest Arab economy to fall to 4.4 percent in 2013 from 6.8 percent the previous year, blaming an anticipated drop in oil production and government spending.
Mubarak said the 2013 budget surplus was SR180bn ($48bn), or 6.5 percent of gross domestic product. In 2012, the budget surplus was SR386bn ($102.93bn).
He said the current account surplus was SR486.7bn ($130bn), or 17.4 percent of GDP. Inflation rose from 2.9 percent in 2012 to 3.5 percent last year but “remains under control”, Mubarak said.
Meanwhile, public debt dropped to SR75bn ($20bn), or 2.7 percent of GDP. Saudi Arabia has been using part of its massive oil revenue to repay its public debt.
The IMF had advised Riyadh to gradually raise energy prices to cut consumption which has been rising rapidly because of the kingdom’s growing population.
Meanwhile, Saudi Arabia thinks that the Chinese yuan is a good option for diversifying foreign currency reserves but it is still far from being a reserve currency, the central bank governor said yesterday.
Asked whether it made sense to consider diversifying the central bank’s reserves to include the yuan, also known as the renminbi, or explore a currency swap agreement, Mubarak said: “We think it is a stronger currency, but it is far from being a reserve currency at this stage.”
”But indeed it represents a good option and a good diversifier and we have seen that some of the central banks have some reserves in the renminbi,” he said at an annual news conference in the Saudi capital.
Mubarak, who does not comment on policy outside of annual press briefings, did not say, however, whether the central bank had considered adding the yuan to its portfolio of net foreign assets. Its reserves, the vast majority of which are believed to be in US dollars, grew to a record $718bn in January.
A gradual easing of restrictions on the yuan and increasing trade with China have led some of Beijing’s partner countries include the renminbi in their official reserves and open currency swap agreements.
Among the Gulf Arab oil exporters, who mostly peg their currencies to the US dollar, the United Arab Emirates signed a three-year currency swap agreement worth $5.5bn with China in 2012 to boost two-way trade and investment.Reuters
