Vision 2030 gigaprojects will drive credit growth over the coming years, Moody’s said.

Following moderate growth between 2016 and 2021, corporate lending gained momentum, rising by 14 percent in 2022 and 7 percent in 2023.

Bank lending is anticipated to be fuelled by a further increase in corporate loans as the Kingdom progresses with the next phase of project implementation. Subcontractors working on Vision 2030 projects are also expected to increase their borrowings.

The report said mortgage growth is decelerating, likely due to higher interest rates and Saudi Arabia nearing its 70 percent homeownership goal. This has prompted the government to diversify its focus toward other areas of the economy.

Moody’s expects the government to ramp up infrastructure investment in preparation for several high-profile international events such as the 2027 Asia Cup, 2029 Asian Winter Games, Expo 2030 and 2034 FIFA World Cup.

The rating agency noted complementaries in infrastructure investment between the events and the gigaprojects. Therefore, resource allocation will likely target projects needed to prepare the country to accommodate these events, at least over the next few years, it added.

(Editing by Anoop Menon) (anoop.menon@lseg.com)

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