gulfnews : Saudi growth needn't cause inflation

Saudi Arabia's economy is poised for remarkable growth in 2011 on the back of numerous positive factors including steady oil prices and stronger domestic spending. Recently, the International Monetary Fund revealed that it expects Saudi Arabia to achieve a real gross domestic product growth rate — adjusted for inflation — of 6.5 per cent in 2011, up from 4.1 per cent in 2010 and 0.1 per cent in 2009.

The new rate fits IMF's newly revised GDP growth rate for Gulf Cooperation Council (GCC) countries, which it has raised from 5.2 per cent to 7.8 per cent in 2011. Qatar outperforms fellow GCC economies in GDP growth thanks to development of its oil and gas sector.

The notable GDP growth for Saudi Arabia in 2011 partly reflects stronger governmental projects which have led to a spillover effect in the private sector. As such, a good measure of growth is to unfold in the non-oil sector.

* username: rupertbu