Is A Debt Problem Brewing In Saudi Arabia?

Is A Debt Problem Brewing In Saudi Arabia?:

"The rapid expansion of credit in Saudi Arabia is beginning to look like a cause for concern, warns Jason Tuvey of Capital Economics. If sustained, it could be followed by a rise in bad loans.

Saudi Arabia’s private sector credit-to-GDP ratio currently stands at 39 percent -- the lowest among the six Arab monarchies along the Persian Gulf. But the danger lies not in the stock of credit, but the pace at which it is rising relative to GDP.

“A rapidly rising credit ratio would indicate that credit is being used inefficiently, whereas a more gradual increase in the credit ratio would suggest that it is being put towards more productive uses,” Tuvey said in a note."

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