Insights

Saudi Labor Market Outlook

The Saudi labor market has undergone significant and dynamic change over the course of the last decade. The labor market is notably segmented and unique challenges are being encountered with the employment of Saudi nationals into the private sector. This report analyses the transformation that has taken place and looks ahead to the potential significant challenges still facing the labor market within the Kingdom. In this report, we analyze the interesting trends from the period 2005-15 and present three different scenarios as part of our forecast for the period 2015-25.

Seasonality in the Saudi Stock Market - (TASI trading in and around Ramadan)

In the next few days, Ramadan, the ninth month of the Hjiri (Islamic) calendar, will begin. Typically during this holy month, working hours are restricted, and most sectors witness subdued business activity. This year Ramadan will commence a few days after the admission of qualified foreign investors (QFIs) into the Saudi Stock Exchange (Tadawul). With these two events closely following each other, we thought it would be beneficial to get a better sense of the typical trading patterns observed in and around the Ramadan period, especially for the benefit of QFIs entering the market.

Q1 15 GDP

Econ update- September 2015

In this report, we have revised our 2015 and 2016 forecasts to take account of a recent flow of data that has generally been slightly weaker than we had anticipated. We forecast real GDP growth to reach 3.2 percent, and 2.3 percent in 2015 and 2016 respectively, down from 3.5 percent in 2014. The high level of spending on the economy, together with low oil prices, will mean a larger than anticipated fiscal deficit, while the current account deficit will be small in 2015. However, the new government deficit financing strategy of reserve withdrawals and debt issuance will ensure a stable and gradual consolidation in public expenditure as the fiscal balance starts to improve from 2016.

Update: Opening the TADAWUL up to Foreign Investors

Last week the Capital Markets Authority (CMA) confirmed that the regions largest, diverse and most mature capital market, the Tadawul, will be open to qualified foreign institutional investors (QFIs) by mid-2015. Currently, the Saudi stock markets capitalization is $528bn, equivalent to two thirds of Saudi GDP, making it larger than the Mexican stock market. When compared regionally it is almost the same size as all the other equity markets in the Gulf combined. Opening up the market is likely to lead to inclusion into the MSCI emerging market index by mid-2017, with as much as $40-50 billion of total foreign inflows. Since the publication of our original report, <a href="http://{{siteurlwithoutprotocol}}/en/download/saudi-stock-market-august-2014-1/research-10-2">Opening the Tawadul up to Foreign Investors</a>, back in August 2014, we have seen a number of developments which have impacted the Tadawul All Share Index (TASI). This includes a massive drop in oil prices which negatively impacted investor sentimental and led to panic selling, and the $6 billion initial public offering (IPO) of the National Commercial Bank (NCB), which amounted to the second-biggest IPO of 2014 globally. In this update we discuss some of these recent developments in more detail.