Large, But Narrowing, Surpluses Ahead

Saudi Arabia's current account looks set to continue posting large surpluses over the coming years. We expect soaring income from hydrocarbon exports to push the current account into the black to the tune of US$110.9bn (SAR427.2bn) - or 24.3% of GDP - this year, up from a surplus of US$66.8bn (15.3% of GDP) in 2010. Beyond 2011, we anticipate that moderating global energy prices, rising imports and increased outflows of remittances and foreign aid will lead to a gradually contracting surplus, but we nevertheless expect the country's external account position to remain healthy for the foreseeable future.

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