Economic Pain on Saudi Post-Oil Path to Test Rulers' Resolve
- Government shake-up Saturday latest step in Saudi Vision 2030
- Economic growth set to slow as reforms weigh on private sector
The King Abdullah financial district sits on the horizon seen from a skyscraper under construction in Riyadh, Saudi Arabia, on Sunday, Jan. 10, 2016. Saudi Arabian stocks led Gulf Arab markets lower after oil extended its slump from the lowest close since 2004.
Photographer: Waseem Obaidi/BloombergThe investors who flocked to one of Saudi Arabia’s biggest business events last week heard ambitious plans for the kingdom’s future and little on how to manage the painful transition to the post-oil era.
Among the changes that officials discussed at the annual Euromoney conference were a plan to loosen restrictions on foreign investment in stocks, a new corporate law that would ease doing business and a bankruptcy law finally on track for approval. While the measures aim to energize private businesses to offset the drop in government spending, they are unlikely to reverse an economic slowdown that will test the leadership’s resolve in pushing for crucial reforms that could trigger public resentment.