When oil prices collapsed globally, Saudi Arabia rose up to the challenge and introduced steps to face the downturn in the economy. It drew a series of plans to tide over the looming crisis, optimized its expenses, and sought new sources of income, even as some other countries faced a similar situation and were showing signs of collapsing. Results show that these efforts are already bearing fruit. There is a 50% drop in the budget deficit, clearly indicating that the national economy has resisted the headwinds and has overcome the immediate fallout of low oil prices. Analysts agree that the prudent economic strategies pursued by the Kingdom are the primary reasons for this positive turnaround. Ahmad Al-Shahry, an economic analyst, asserted that the Saudi economy remains strong thanks to its high-performing companies and good liquidity in the market. These are all the elements that make a strong national economy and help it resist economic downturns as was being experienced by a number of world economies. The Saudi economy remains the strongest economy in the region. Its solution to facing tough economic times lies in tackling areas that show a drop in returns – that is, the oil sector. Moreover, the small and medium enterprises need to be encouraged to have a balanced economic structure that is able to withstand market turbulence, Al-Sharhy said He was of the view that flexible and quick action will boost the national economy, which has now shown signs of recovery with a strong budget. "We have vast economic assets and follow well-thought-out strategies. What makes us optimistic is the government's focus on new growth engines which were not tapped before – mining for example." Al-Sharhy cited the example of Sadara Chemical Company, which recently marked the commissioning of the last of its 26 plants. The company's achievements will have a positive impact on the national economy. Such companies will provide the economic sector with more independence and distribute earnings fairly, which will make the economy stronger and stable, capable of generating new jobs and improving wages. He added that the private sector plays an important role in the national economy. This is why the sector needs to be encouraged and given more incentives. It now largely depends on governmental spending, making it play a rather diminished role in the economy. Abdullah Al-Ridy, another analyst, stressed that the national economy has tried to adapt to the new situation caused by falling oil prices. Besides the fact that the Kingdom depended on the strength of the oil market, it was also burdened with state subsidies. These subsidies were a strain on the economy, he said. He praised the effective economic reforms carried out by the Kingdom and said they have contributed significantly to cushioning the hard impact of the downturn. These reforms, reflected in the Vision 2030 program, have provided a buffer against the ill effects of a slowing economy, he said.
