#Saudi Economic ‘Overheating’ Fears Emerge as Constraint on Plans - Bloomberg

Saudi Economic ‘Overheating’ Fears Emerge as Constraint on Plans - Bloomberg

Saudi Arabia wants to avoid sending the economy into overdrive as it channels investments with the goal of pivoting the nation away from oil dependency.

Finance Minister Mohammed Al-Jadaan said Tuesday that while his country’s massive investments are helping to grow the non-oil economy, the kingdom needs to be careful about “overheating” — which could cause inflation to quicken — and “leakages.”

“If you don’t allow your economy to catch up with your projects, basically what will happen is you’ll import a lot more,” Al-Jadaan said at the Qatar Economic Forum. As a result, Saudi Arabia could lack the factories and other capacity needed to support its plans, according to Al-Jadaan.

“So giving it more time is actually wise,” he said.

The economic makeover, known as Vision 2030, has been hitting some snags eight years after being unveiled by Crown Prince Mohammed bin Salman. Al-Jadaan has previously acknowledged that there may be delays or acceleration for some projects.

Under the crown prince’s blueprint, Saudi Arabia is pumping hundreds of billions of dollars into everything from electric vehicles to semiconductors and sports.