Saudi Arabia’s robust economic fundamentals and policy reforms continue to hold the economy in good stead despite the regional conflict.

The combination of relatively low debt-to-GDP ratios versus developed markets and higher oil prices underpins the Kingdom’s credit quality, which is helping to stabilize debt yields.

The strong recovery in the TASI coupled with the lowering in KSA’s 30-year bond spread to US treasury bonds in the aftermath of the conflict reflect the economy’s resilience despite unprecedented regional disruptions.

Another indicator of the underlying confidence in KSA is the March 11th IPO debut of a mining and construction materials company on the Tadawul, trading for which has surged by over 30% since the launch.

There are also additional IPOs in the pipeline from the contracting, real estate and e-commerce sectors driven by strong domestic liquidity and ongoing economic diversification initiatives.

Moreover, in the context of deal activity, PIF subsidiary Savvy Games' announcement of the acquisition of a prominent Chinese video game developer for US$6 billion further underscores the Saudi economy’s perseverance in the face of testing times.

Important notice: Views expressed are those of Rima M. Bhatia as at the date of publication, do not constitute financial or other professional advice, and do not necessarily reflect the views of Gulf International Bank (GIB) or Inside Saudi.

For more data-driven insights, click here subscribe to our newsletter, or follow us on LinkedIn.