RIYADH: Saudi Arabia’s official reserve assets experienced a 2.22 percent year-on-year increase, reaching SR1.63 trillion ($435.41 billion) in October, highlighting the Kingdom’s robust fiscal stability.
Data from the Saudi Central Bank, or SAMA, indicates that these assets encompass monetary gold, special drawing rights (SDRs), the International Monetary Fund’s (IMF) reserve position, and foreign reserves. The latter, which includes currency and deposits abroad along with investments in foreign securities, constituted 94.34 percent of the total, amounting to SR1.54 trillion in October—a 2.32 percent annual rise.
SDRs climbed to SR78.42 billion, reflecting a 2.09 percent increase and representing 4.8 percent of Saudi Arabia’s total reserves. SDRs, created by the IMF to augment member countries’ official reserves, derive their value from a basket of major currencies such as the US dollar, euro, Chinese yuan, Japanese yen, and British pound sterling. These can be exchanged among governments for freely usable currencies when necessary.
Beyond providing supplementary liquidity, SDRs contribute to exchange rate stability, serve as a unit of account, and support international trade and financial stability. The IMF reserve position stood at approximately SR12.41 billion but saw an 8.03 percent decline during this period. This category signifies the amount a country can withdraw from the IMF without conditions.
Gold reserves remained unchanged at SR1.62 billion, a level consistent since February 2008. Saudi Arabia’s reserve assets, supported by substantial foreign exchange reserves and sovereign wealth managed through entities like the Public Investment Fund, form a cornerstone of the Kingdom’s fiscal strength.
These reserves offer the government a strong financial cushion to address economic challenges, including fluctuating oil revenues, global financial market volatility, and geopolitical risks. With substantial reserve levels, the Kingdom is well-equipped to meet its financing needs across various timeframes.
This financial resilience enhances Saudi Arabia’s ability to secure favorable borrowing terms in both domestic and international markets, boosting investor confidence and fiscal sustainability. The strategic management of these assets aligns with Saudi Arabia’s Vision 2030, which emphasizes economic diversification, strengthening non-oil sectors, and achieving sustainable long-term growth.
This comprehensive approach enables the Kingdom to mitigate risks, foster stability, and pursue its ambitious economic goals.
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