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Wed 25 Oct 2017 09:50 AM

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IMF chief discusses economic priorities with Saudi Arabia

Christine Lagarde recognises progress in Gulf kingdom's ambitious reform agenda

IMF chief discusses economic priorities with Saudi Arabia
Saudi Crown Prince Mohammed bin Salman (R) and Managing Director of International Monetary Fund Christine Lagarde (L) attend the Future Investment Initiative (FII) conference in Riyadh.

International Monetary Fund (IMF) managing director Christine Lagarde has met with Crown Prince Mohammed bin Salman to discuss Saudi Arabia’s economic outlook and current policy developments.

“Saudi Arabia had made good progress in initiating its ambitious reform agenda. Fiscal consolidation efforts are beginning to bear fruit,” Lagarde said in a statement.

“Progress with reforms to improve the business environment are gaining momentum, and a framework to increase the transparency and accountability of government is in place,” she added.

Lagarde said effective prioritization, sequencing, and coordination of the reforms is essential, and Saudi Arabia needs to be well-communicated and equitable to gain social buy-in to ensure their success.

“A large, sustained, and well-paced fiscal adjustment is needed in the coming years to continue to respond to the effects of lower oil prices on the budget. However, given the strong fiscal buffers, the availability of financing, and the current cyclical position of the economy, fiscal adjustment should be gradual,” Lagarde said.

Lagarde also met with Saudi women to discuss ways to further boost female labour force participation and entrepreneurship. Reforms discussed include subsidising transportation and childcare costs and encouraging greater use of teleworking.