The political revolution unveiled by Crown Prince Muhammad bin Salman and the possible shelving of the Aramco flotation raise questions about the economic reform programme.
Economic risk (MEDIUM): A return to growth in the first quarter of 2018 indicates an economy on the turn. The extra 1m of oil to be pumped by OPEC will combine with 2.3% non-oil growth.
Political risk (HIGH): The decision to go through with granting women the right to drive shows the Crown Prince’s social reform programme is on track.
Financial risk (LOW): The banking system is stable, well-regulated and well-capitalised. Entry into the MSCI emerging markets index will attract funds into the market but the shelving of the Aramco privatisation would be a reputational blow.
Commercial risk (MEDIUM): The right for Saudi women to drive will aid female entrepreneurship. The coun- try sits in the middle of the World Bank’s Doing Business index. FDI has risen 130% since reforms kicked in.