Saudi Arabia
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Saudi Arabia’s interconnections with the global economy, and the constraints that these linkages impose on domestic policy choices, continue to evolve. Specifically, fiscal policy is constrained by developments in the global oil market while monetary policy is guided by the U.S. dollar peg. Over the past couple of decades, two important developments have occurred. First, growing oil needs from emerging market economies (EMEs) have become increasingly important for oil market dynamics. Second, financial sector development in Saudi Arabia has strengthened the monetary transmission mechanism. The former implies greater influence of EMEs’ economic fluctuations on Saudi oil export revenues, while the latter suggests greater influence of U.S. monetary policy on the Saudi non-oil sector. Hence, situations in which global oil prices move counter-cyclically with the U.S. business cycle are increasingly likely and could generate tension between policy objectives.

Abstract

Saudi Arabia’s interconnections with the global economy, and the constraints that these linkages impose on domestic policy choices, continue to evolve. Specifically, fiscal policy is constrained by developments in the global oil market while monetary policy is guided by the U.S. dollar peg. Over the past couple of decades, two important developments have occurred. First, growing oil needs from emerging market economies (EMEs) have become increasingly important for oil market dynamics. Second, financial sector development in Saudi Arabia has strengthened the monetary transmission mechanism. The former implies greater influence of EMEs’ economic fluctuations on Saudi oil export revenues, while the latter suggests greater influence of U.S. monetary policy on the Saudi non-oil sector. Hence, situations in which global oil prices move counter-cyclically with the U.S. business cycle are increasingly likely and could generate tension between policy objectives.

III. External Linkages and Policy Constraints in saudi Arabia1

Saudi Arabia’s interconnections with the global economy, and the constraints that these linkages impose on domestic policy choices, continue to evolve. Specifically, fiscal policy is constrained by developments in the global oil market while monetary policy is guided by the U.S. dollar peg. Over the past couple of decades, two important developments have occurred. First, growing oil needs from emerging market economies (EMEs) have become increasingly important for oil market dynamics. Second, financial sector development in Saudi Arabia has strengthened the monetary transmission mechanism. The former implies greater influence of EMEs’ economic fluctuations on Saudi oil export revenues, while the latter suggests greater influence of U.S. monetary policy on the Saudi non-oil sector. Hence, situations in which global oil prices move counter-cyclically with the U.S. business cycle are increasingly likely and could generate tension between policy objectives.

A. Introduction

1. Developments during 2004–08 illustrate the interplay between global interconnectedness and domestic policy trade-offs. On September 18, 2007, the U.S. Federal Reserve lowered its policy rate from 5.25 percent, the highest rate since March 2001, to 4.75 percent, citing tightening credit conditions and an ongoing housing market correction. By the end of October 2008, the federal funds target rate had been reduced to just 1 percent. During the same time period, crude oil prices surged from over $65 per barrel in mid-2007 to over $130 per barrel by the summer of 2008, partly driven by increased demand from EMEs. The situation in Saudi Arabia was quite different from that in the U.S. The rise in oil prices between 2004 and 2007 had raised oil revenues to the government, and these had been reflected in increased spending, leading to higher economic growth, but also rising inflationary pressure. Nonetheless, in order to prevent speculative capital inflows and maintain the exchange rate peg to the U.S. dollar the Saudi Arabian Monetary Agency (SAMA) cut its policy rate from 5 percent in October of 2007 to 2 percent by mid-2008. Annual credit growth increased from 6 percent in early 2007 to over 30 percent in July 2008, while higher world commodity prices, coupled with a depreciating dollar, further contributed to inflationary pressure, resulting in double-digit inflation by mid-2008. This episode clearly illustrates how global interconnectedness affected policy tradeoffs and had a significant impact on the Saudi Arabian economy.

2. The chapter examines the evolution of interconnectedness and its impact on policy constraints in Saudi Arabia. Given the country’s dependence on oil, growing linkages with developing Asia, and the peg to the U.S. dollar, the note focuses on three external factors: (i) global oil prices, (ii) the U.S. business cycle, and (iii) developing Asia’s business cycle. The motivation for examining Saudi Arabia is not only that it is an interesting case in its own right, but also that it illustrates many features that are common across resource-rich economies. In particular, Saudi Arabia exhibits a low degree of economic diversification, with the oil sector accounting for over half of GDP and oil exports accounting for over 80 percent of export receipts. Furthermore, as oil revenues primarily accrue to the government, the public sector plays a central and dominant role in the non-oil economy. Finally, with the exchange rate pegged to the U.S. dollar and with a relatively open financial account, interest rate policy closely follows that of the U.S. Federal Reserve. All these characteristics can be found in many other resource-rich countries, albeit to varying degrees.

3. Empirical results show that three main dynamics have emerged over the past three decades. First, the correlation between the Saudi and U.S. business cycles has shifted over time, with supply-driven oil shocks causing a divergence in business cycle dynamics in the 1980s, while demand-driven oil shocks in the 2000s—reflecting high growth in developing Asia—resulted in a convergence. Second, the pass-through from global oil prices to fiscal spending has fallen over the past three decades, possibly accounting for the observed reduction in output volatility. Finally, credit dynamics have become increasingly relevant for non-oil economic activity, and the importance of U.S. interest rate policy has likely risen in the 2000s.

4. These developments suggest increased importance of a strong macroeconomic policy framework. Given the commitment to the fixed exchange rate and the ongoing financial deepening, synchronization of the domestic and U.S. business cycles is likely to become increasingly relevant for the stabilizing impact of monetary policy. At the same time, the degree of structural interconnectedness with developing Asia has increased over time, as a result of growing trade flows and Asia’s rising influence in the global oil market. Tensions between policy objectives are therefore more likely to arise when global oil prices and the Asian business cycle move countercyclically with the U.S. business cycle. These tensions highlight the importance for Saudi Arabia of strong fiscal management as well as further refining macro prudential instruments to influence monetary conditions independently of interest rate policy.

B. Business Cycles and Global Oil Prices

5. A positive correlation between the business cycles of the United States, developing Asia, and Saudi Arabia has emerged over time. Figures III.1 and III.2 compare annually de-trended U.S. and developing Asia’s real GDP with real non-oil GDP of Saudi Arabia. The data cover the three decades from 1980 to 2010. Figure III.3 compares fluctuations in Saudi non-oil GDP with the average global oil price. Four observations immediately stand out. First, there is a clear negative relationship between U.S. and Saudi Arabian economic fluctuations in the 1980s. This negative correlation later reversed and a positive relationship emerges in the mid-1990s. Second, economic fluctuations in developing Asia do not appear to be well correlated with Saudi non-oil GDP in the first half of the sample, but become positively correlated at the end of the 1990s and throughout the 2000s. Third, oil prices tend to be positively correlated with Saudi non-oil GDP throughout the whole sample period. Finally, volatility in Saudi non-oil GDP falls significantly in the 2000s. This also seems to be true in comparison to the United States and developing Asia.

Figure III.1.
Figure III.1.

Cyclical GDP of the United States and Saudi Arabia, 1980–2010

Percentage deviation from trend)

Citation: IMF Staff Country Reports 2012, 272; 10.5089/9781475510621.002.A003

Sources: IMF World Economic Outlook database; CDSI; and IMF staff calculations.
Figure III.2.
Figure III.2.

Cyclical GDP of Developing Asia and Saudi Arabia, 1980–2010

(Percentage deviation from trend)

Citation: IMF Staff Country Reports 2012, 272; 10.5089/9781475510621.002.A003

Sources: IMF World Economic Outlook database; CDSI; and IMF staff calculations.
Figure III.3.
Figure III.3.

Oil Price and Saudi Arabia Non-oil GDP, 1980–2010

(Percentage deviation from trend)

Citation: IMF Staff Country Reports 2012, 272; 10.5089/9781475510621.002.A003

Sources: IMF World Economic Outlook database; CDSI; and IMF staff calculations.

6. A formal regression analysis supports a break in the business cycle dynamics in the mid-1990s. The conditional relationship between the three external factors and the Saudi non-oil economy can be examined via a simple regression with Saudi Arabia’s non-oil GDP as the dependent variable, and U.S. and developing Asia’s real GDP together with the average oil price as independent variables. All variables are detrended using the HP filter. The assumption of exogeneity of the explanatory variables is fairly non-controversial, as economic fluctuations in the United States and developing Asia, and movements in the global oil price, are unlikely to be affected by Saudi non-oil GDP. Given the observed reversal in business cycle correlations, the regression analysis is conducted on the full sample as well as for two subsamples i.e., 1980–95 and 1996–2010. The results (shown in Table III.1) are in broad agreement with the observations from Figures III.13. When the full sample is used, U.S. real GDP is negatively and statistically significant related to Saudi non-oil GDP. When the sample is split, the negative relationship only holds for the 1981–95 period while it turns positive in the 1996–2010 period As expected, developing Asia’s real GDP is not statistically significant when the full sample is used, but positive and statistically significant for the 1996–2010 period. Finally, the oil price has a positive impact on non-oil GDP in the first period, but is neither economically nor statistically significant in the second period. The latter may reflect both that oil prices were primarily driven by global demand—captured through the Asian and U.S. business cycle dynamics—and that the pass-through from oil revenues to fiscal spending has declined (Section C).

Table III.1.

Relevance of External Factors for the Non-oil Economy

article image
Sources: WEO; CDS; and IMF staff calculations.

All variables are detrended using the HP filter, (*) indicates a statistical significance level of 5 percent

7. What could explain the divergence between U.S. and Saudi business cycles in 1980s and subsequent correlation reversal in the late 1990s and 2000s? To a large extent the answer is related to whether the oil price cycle was driven by supply or demand. For Saudi Arabia, as a net oil exporter, it is largely irrelevant (at least in the initial stage) whether a rise in the global oil price is due to a positive demand shock or a negative supply shock. Both will cause oil export revenues to rise. However, for a net oil importer such as the United States the economic impact of a supply-driven or demand-driven oil shock is quite different. For instance, a rise in the oil price due to a supply shock increases the cost of production, leads to output contraction, and raises prices. Thus, one possible explanation for the observed reversal of business cycle correlations is that oil price shocks were primarily supply-driven in the 1980s and early 1990s, while they were demand-driven in the late 1990s and 2000s. Box II.1 explores this explanation in more detail.

Demand and Supply Driven Shocks and Business Cycle Correlations

The 1980s and early 1990s. Three major oil supply disruptions occurred between 1978 and 1991: (i) the Iranian Revolution (1978–79), Iraq’s invasion of Iran (1980–81), and the first Gulf war (1990). The effect of these shocks on the Saudi Arabian economy was significant. The rise in the oil price in 1978–81 caused oil export revenues in Saudi Arabia to increase by over 90 percent from approximately $58 billion in 1978 to $111 billion in 1981. This sizable windfall was partly spent as fiscal spending rose by 41 percent over the same time period, and partly saved as international reserves. As a result, non-oil growth increased from 6 percent in 1979 to 10 percent in 1981.

The impact on the U.S. economy was, by contrast, far from favorable. Although many factors contributed to the U.S. recessions of 1979–80 and 1981–82, the rise in the price of oil is generally viewed as a significant contributor. The economic downturn in the United States and Europe in the early 1980s led to a sharp decline in oil consumption. To support the high oil price, OPEC assigned production quotas to each member. However, the bulk of the burden fell on Saudi Arabia, which operated as the swing producer and was committed to the official price system. As a result, Saudi oil production fell sharply from 10 mbd in 1980 to about 3 mbd in 1985. Hence, at a time when the U.S. economy was recovering, the favorable conditions in Saudi Arabia began to deteriorate. Oil export revenues fell from $111 billion in 1981 to $11 billion in 1986; spending fell from $84 billion to $37 billion over the same time period. The effect on growth was substantial as non-oil GDP contracted by 1.2 percent in 1984 and by 5.7 percent in 1986. However, with abandonment of its role as the swing producer in OPEC, Saudi Arabia’s oil revenues slowly began to recover, and the non-oil economy began to expand by the end of the decade.

By the end of the 1980s the U.S. economy was at its business cycle peak, but a financial crisis coupled with tighter monetary policy started to weigh on the economy, which fell into a recession in 1990. The oil price shock following Iraq’s invasion of Kuwait in August 1990 came, therefore, at an unfortunate point in time for the U.S. economy and likely worsened the downturn. Meanwhile, the oil price spike—coupled with an increase in Saudi Arabian oil production to compensate for the disruption in global supply—increased oil revenues in Saudi Arabia and further helped the domestic economy in its post-1986 recovery as non-oil growth rose above 5 percent in 1992.

The late 1990s and 2000s. Although several events occurred in the late 1990s and 2000s that had a significant impact on global oil prices (e.g., the Asian crisis, the OPEC meeting in 1999, the recession in 2001, and the second Gulf War in 2003), the most striking characteristic in oil price dynamics has been the consistent upward trend since 1998.

Hamilton (2009) and other observers have attributed this upward trend to the strong growth performance of developing Asia and its impact on global oil demand. Indeed, the sharp increase in crude oil consumption in China, the main consumer within the block of developing Asian economies, is particularly impressive. Since the mid-1990s crude consumption in China has increased from 3 mbd to above 8 mbd in 2010. The country’s share of global consumption increased from 4 percent to 10 percent during the same time period. Meanwhile the share of global crude oil consumption of developing Asia as a whole increased from 11 percent in 1995 to over 19 percent in 2010.

Developing Asia’s rising demand for oil was particularly apparent in the period 2004–08 as the price of oil climbed from an average of $40 per barrel to over $130 per barrel. During this period, developing Asia accounted for over 43 percent of the global increase in crude oil consumption, while North America and Europe combined accounted for 21 percent. Another contributing factor to the sharp rise in oil prices during this time period was the stability in global oil production. While the global economy grew by over 19 percent from 2004 to 2008, total oil production only rose by 1.8 percent (from 80.6 mbd to 82.0 mbd).

As oil price dynamics in the 2000s began primarily to reflect demand forces, the oil price cycle became increasingly pro-cyclical. This, in turn, implied that the Saudi non-oil GDP began to co-move positively with both the U.S. and developing Asia’s GDP The sharp increase in oil revenues in the latter part of the 2000s translated into stable annual non-oil growth rates of 4 and 5 percent, the highest since the early 1980s.

Another argument for the increased relative importance of demand dynamics in the 1990s and 2000s is that Saudi Arabia has internalized the impact of negative supply shocks on revenue volatility by investing in, and using, spare capacity to smooth oil price dynamics (e.g., during the Gulf Wars and the Libyan crisis).

C. Fiscal Policy and Oil Revenue Volatility

8. With government spending amounting to over 80 percent of non-oil GDP and the public sector taking a central role in the economy, fiscal policy constitutes the main driving force behind non-oil growth. The principal task for fiscal policy has been to balance development goals (i.e., invest in social and economic infrastructure and promote economic diversification) with macroeconomic stability in an environment of volatile oil revenues. To do so the government has engaged in counter-cyclical fiscal policy with respect to the oil price cycle. That is, when oil prices are low the government either draws down on international reserves or issues debt to finance its expenditure, and when oil prices are high part of the surplus is used to retire existing debt and build up reserves. Hence, by conducting counter-cyclical policy, the government attempts to smooth fiscal spending over time.

9. How successful has the Saudi government been in its attempt to smooth spending in the face of volatile oil revenues? Table III.2 summarizes the volatility in the growth rates of oil revenues and fiscal spending and the corresponding correlation coefficient for each of the past three decades. Several broad observations can be made. First, there is a clear positive relationship between oil revenue and spending growth over the past three decades. Second, oil revenue volatility was high in the 1980s, declined in 1990s, and rose again in the 2000s. Spending volatility, on the other hand, has fallen consistently over the past three decades. Finally, the correlation between revenue and spending was high in the 1980s and 1990s, but fell significantly in the 2000s. Hence, it seems that the fiscal authorities have been gradually more successful in smoothing spending despite continued oil revenue volatility. One major difference between the 1980s and 2000s was that oil revenues were declining for a significant portion of the 1980s while the opposite was true in the 2000s. There might thus be an asymmetrical response to increases versus decreases in oil revenues. This could potentially explain why non-oil GDP in the 2000s was less volatile than in previous decades.

Table III.2.

Volatility and Correlation of Oil Revenue, Spending and Non-oil Growth

article image
Sources: National authorities; and IMF staff calculations.

D. Financial Deepening and Monetary Policy

10. As in most emerging economies, the financial system in Saudi Arabia is dominated by commercial banks. As a consequence, monetary policy primarily influences economic activity through two channels: the exchange rate and bank lending. However, with the U.S. dollar peg and the open financial account, SAMA’s ability to affect the economy through the exchange rate and the short-term interest rate is limited. Al-Jasser and Banafe (1999) lay out the channels of the monetary transmission mechanism in Saudi Arabia. They argue that the interest and credit channels are likely to be weak due to the presence of government-controlled Specialized Credit Institutions (SCIs), lack of financial leverage, and imperfect pass-through of the policy rate to the lending rate due to imperfect competition.

11. Since 1999, however, the banking system in Saudi Arabia has grown significantly in size while the relative importance of SCIs has declined (Figures III.4 and III.5). Furthermore, SAMA has taken steps to liberalize the banking system and allow for increased competition (SAMA, 2003). An increased presence of foreign banks has also emerged, following Saudi Arabia’s accession to the WTO (Ramady, 2010). Thus, as the financial system has deepened and the frictions identified by Al-Jasser and Banafe (1999) have loosened up, it is reasonable to assume that the effectiveness of monetary policy has increased over time.

Figure III.4.
Figure III.4.

Credit by Commercial Banks

(Percent of non-oil GDP)

Citation: IMF Staff Country Reports 2012, 272; 10.5089/9781475510621.002.A003

Source: Saudi Arabian Monetary Agency.
Figure III.5.
Figure III.5.

Credit by Specialized Credit Institutions, 1987–2010

(Percent of non-oil GDP)

Citation: IMF Staff Country Reports 2012, 272; 10.5089/9781475510621.002.A003

Source: Saudi Arabian Monetary Agency.

12. The first step in assessing the evolving relevance of monetary policy is to examine whether credit has become more important to business cycle dynamics.

  • Granger causality test. The test addresses the following question: Can real credit help forecast fluctuations in non-oil GDP (and vice versa) and has its ability to do so changed over time? Based on annual detrended data of real credit and non-oil GDP from 1980 to 2010 the answer is no. That is, real credit does not Granger cause non-oil GDP and vice versa. However, when splitting the sample, results change significantly. In particular, for the sample period 1996–2010, the null of no Granger causality is rejected, supporting the notion that real credit has become more important to the non-oil economy over time.

  • Impulse responses. To further investigate the relationship between bank credit and non-oil economic activity over time, a simple bivariate vector autoregressive model (VAR) was constructed. The model was estimated with two lags, as suggested by the AIC lag order selection criteria. The identification scheme assumes that non-oil GDP reacts contemporaneously with a shock to credit, but not the reverse. The results do not change markedly if the reverse ordering is used. Again, the model is first estimated for the full sample and then for the subsamples 1980–95 and 1996–2010. For the full sample, the response of non-oil GDP to a one standard deviation shock to real credit is positive in the first two years, but insignificant. The dynamics change substantially when the sample is split. Non-oil GDP still responds positively initially to real credit shocks in both subperiods. However, although the magnitude of the response is smaller, the positive effect is more prolonged and statistically significant in the 1996–2010 period (Figures III.6 and III.7).

  • Variance decomposition. The results from the corresponding variance decomposition shows that that real credit explains more of the forecast error variance of non-oil GDP in the 1996–2010 period (58 percent after five years) compared to the 1980–95 period (40 percent after five years) . Again, this seems to indicate an increased relevance of credit for the non-oil economy.

Figure III.6.
Figure III.6.

Response of Non-oil GDP to a one Standard Deviation Real Credit Shock, 1980–1995

Citation: IMF Staff Country Reports 2012, 272; 10.5089/9781475510621.002.A003

Source: IMF staff calculations.
Figure III.7.
Figure III.7.

Response of non-oil GDP to a one Standard Deviation Real Credit Shock, 1996–2010

Citation: IMF Staff Country Reports 2012, 272; 10.5089/9781475510621.002.A003

Source: IMF staff calculations.

13. The results from the VAR using annual data indicate evidence in favor of increased relevance of real credit for non-oil activity. But how has the imported interest rate policy affected real credit over time?

  • Vector autoregressive model: To answer this question a monthly VAR was specified with credit and the CPI as endogenous variables and the three-month LIBOR, oil price, and an international food price index as exogenous variables. The VAR is estimated by log-differencing the variables (except for the LIBOR). The main objective is to test whether the LIBOR significantly impacts credit and inflation. Table III.3 displays the results from the VAR with respect to the exogenous variables. The full sample is 1997:1 to 2008:9. The end date was picked to exclude the global financial crisis as it represents a structural break in U.S. monetary policy as well as a sharp disruption in the overall economic environment. Furthermore, the model was estimated for two subsamples (1997:1–2003:12 and 2003:9–2008:9) to evaluate the evolution of the interest rate channel over time.

  • Results: When the full sample is used, the LIBOR is negatively correlated with credit growth and positively related to inflation, but the net effect of a rise in the LIBOR would be a decline in real credit growth. However, none of the exogenous variables are statistically significant. When the sample is split, statistical significance emerges in both subsamples. In the first period a statistically significant relationship between LIBOR and credit growth is not established. However, for the later period LIBOR has a negative and statistically significantly impact on credit growth. Interestingly, the reverse is true for LIBOR and CPI inflation. In the first period LIBOR has a negative and statistically significant effect on inflation, while the relationship breaks down in the second period. Note that an increase in LIBOR on real credit growth is positive in the first period, but negative in the second. The period 2003:9–2008:9 also shows some significance in terms of other exogenous variables. As expected, the oil price has a positive impact on credit growth, and international food prices have a positive impact on inflation. Perhaps more surprisingly, the nominal effective exchange rate is positively and significantly correlated with credit growth.

Table III.3.

The Impact of LIBOR on Credit and Inflation

article image
Sources: WEO; CDS; and IMF staff calculations.

The optimal length criteria was chosen based on five different lag order selection criteria.

E. Conclusion

14. This chapter examined the evolution of Saudi Arabia’s interconnectedness with the global economy and the constraints that these linkages impose on domestic policy. Two important developments over the past couple of decades were emphasized. First, growing oil needs from EMEs have become increasingly important for oil market dynamics. Second, financial sector development in Saudi Arabia has strengthened the monetary transmission mechanism. The former implies greater influence of EMEs’ economic fluctuations on Saudi oil export revenues, while the latter suggests greater influence of U.S. monetary policy on the Saudi non-oil sector. It was also argued that fiscal policy has been increasingly more successful at smoothing spending despite continued volatility in oil revenues, and may possibly account for the lower output volatility in the 2000s.

15. As external links continue to evolve it is imperative to understand the implications for domestic policy. Given Saudi Arabia’s growing interconnectedness with developing Asia (e.g., China and India) and the continued commitment to the U.S. dollar peg, tension between policy objectives is likely to arise when global oil prices move counter-cyclically with the U.S. business cycle. For instance, the collapse of Libya’s oil exports in 2011 boosted oil revenues and fiscal spending in Saudi Arabia. At the same time the debt crisis in Europe and the downgrade of U.S. sovereign debt raised concerns of a global economic downturn. The combination of expansionary fiscal policy and accommodative monetary policy may again cause inflationary pressure to rise. These developments underline the importance for Saudi Arabia to use fiscal policy as a stabilizing tool and to further refine macro prudential instruments to influence monetary conditions independent of interest rate policy.

References

  • Al-Jasser, Mohammad and Ahmed Banafe, 1999, “Monetary Policy Operating Procedures in Emerging Market Economies.BIS Papers, No. 5.

  • Hamilton, James. 2009, “Causes and Consequences of the Oil Shock 2007–08,Brookings Papers on Economic Activity, Vol. 2009, pp. 215261 (Washington: Brookings Institution).

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  • Ramady, Mohammad A., The Saudi Arabian Economy: Policies, Achievements and Challenges. (New York, Springer International, 2010).

  • Saudi Arabian Monetary Agency, 2003, “A Case Study On Globalization and the Role of Institution Building in the Financial Sector in Saudi Arabia”, Prepared for the G20 Finance and Central Bank Deputies’ Meeting, May 26, 2004, Mexico City.

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Saudi Arabia: Selected Issues
Author:
International Monetary Fund. Middle East and Central Asia Dept.
  • Figure III.1.

    Cyclical GDP of the United States and Saudi Arabia, 1980–2010

    Percentage deviation from trend)

  • Figure III.2.

    Cyclical GDP of Developing Asia and Saudi Arabia, 1980–2010

    (Percentage deviation from trend)

  • Figure III.3.

    Oil Price and Saudi Arabia Non-oil GDP, 1980–2010

    (Percentage deviation from trend)

  • Figure III.4.

    Credit by Commercial Banks

    (Percent of non-oil GDP)

  • Figure III.5.

    Credit by Specialized Credit Institutions, 1987–2010

    (Percent of non-oil GDP)

  • Figure III.6.

    Response of Non-oil GDP to a one Standard Deviation Real Credit Shock, 1980–1995

  • Figure III.7.

    Response of non-oil GDP to a one Standard Deviation Real Credit Shock, 1996–2010