Category: South Caucasus News

Saudi Arabia will register “incredible” economic growth in the next four years, with its financial wealth growing by a compound annual rate of 4.3 percent to hit $1.3 trillion in 2027, according to global management firm Boston Consulting Group. 

A report released on Wednesday further disclosed that real assets in the Kingdom are expected to hit SR3.6 trillion ($960 billion) in 2027, up from SR2.7 trillion in 2022. 

The report further revealed that currency and deposits represented the largest asset class in Saudi Arabia, making up 48 percent of total personal wealth in 2022. 

Earlier this month, the International Monetary Fund said the Kingdom’s fiscal prospects are solid in the near term, with risks broadly balanced, driven by Vision 2030, which has been diversifying the economy since its launch in 2016. 

“Saudi Arabia’s trajectory signals incredible growth and potential despite global market challenges. We anticipate steady growth in the coming years, and a continued focus on diversification will be key to maintaining this growth trajectory,” said Natalia Gerashchenko, managing director and senior partner at BCG, in a statement. 

On the other hand, bonds are forecast to register the fastest growth of 7.4 percent between 2022 and 2027. 

The BCG study also noted that life insurance and pensions are slated to become the third-largest asset class by 2027. 

“The diversification of assets and increasing interest in life insurance and pensions reflect a shift toward long-term planning and financial stability,” added Gerashchenko. 

The report found that the Kingdom represents 14.5 percent of the financial wealth in the Middle East and North Africa region, with approximately 21 percent or $100 million originating from ultra-high net worth individuals. 

“Saudi Arabia’s success in attracting and retaining high net worth individuals is a testament to its growing economic prowess in the region. UHNW individuals contribute to economic growth and bring increased resources and expertise,” said Dmitry Angarov, managing director and partner at BCG. 

On the flip side, the liabilities in the Kingdom are anticipated to grow from $200 billion in 2022 to $400 billion in 2027. 

“This balanced growth highlights the Saudi Arabian economy’s calculated risk-taking abilities, potentially fueling further growth in the coming years,” stated the report. 

According to the IMF, the Kingdom has sufficient precautionary reserves, and the peg of the exchange rate to the US dollar is serving the Saudi economy well.

By Nike Ching

Russian President Vladimir Putin met Wednesday with North Korean leader Kim Jong Un at Russia’s most advanced spaceport amid warnings from the U.S. and South Korea against a potential arms transfer.

Kim pledged his “full and unconditional support” for “all decisions” by Putin, in an apparent reference to Russia’s war on Ukraine, as the two leaders held talks at the Vostochny Cosmodrome in the Amur region of Russia’s far east, near the Chinese border.

The meeting came as media reports quoted unidentified Western officials as saying Russia hopes to receive North Korean artillery shells for use in its war in Ukraine, while Pyongyang appears to want advanced technology for its satellites and nuclear-powered submarines, as well as food assistance from Moscow.

“We need to discuss the issues of economic cooperation and humanitarian issues, as well as the situation in the region,” Putin told Kim.

White House National Security Council spokesman John Kirby told reporters Wednesday the United States has concerns about any kind of potential defense cooperation between Russia and North Korea.

Kirby said the U.S. is carefully monitoring the contacts between Moscow and Pyongyang.

“No nation on the planet, nobody should be helping Mr. Putin kill innocent Ukrainians. And if they decide to move forward with some sort of arms deals, well, obviously we’ll take a measure of that, and we’ll deal with it appropriately,” he said.

At the Vostochny Cosmodrome, Putin and Kim first toured the spaceport, where reporters asked if Russia would help North Korea build satellites.

“That’s why we came here,” Putin said, according to Russian state media. “The leader of the DPRK shows great interest in rocket engineering; they are also trying to develop space.”

DPRK refers to North Korea’s official name, the Democratic People’s Republic of Korea.

As Kim visited Russia Wednesday, North Korea fired two short-range ballistic missiles into the sea off its eastern coast. South Korea’s military said the missiles were launched from near Pyongyang and flew about 650 kilometers.

Ahead of the talks, South Korean officials said they were closely monitoring the first meeting between Kim and Putin in four years.

“Cooperation between Russia and North Korea should be made in the direction of contributing to peace and prosperity on the Korean peninsula while adhering to the relevant UN Security Council resolutions,” a spokesperson from South Korea’s foreign ministry said on Wednesday.

The U.S. and South Korea have renewed warnings to North Korea not to provide munitions to Russia that could be used in the Ukraine war.

“Any transfer of arms from North Korea to Russia would violate multiple United Nations Security Council resolutions,” said U.S. State Department spokesperson Matthew Miller during a Tuesday briefing. “We will monitor what happens and will not hesitate to take action to hold those accountable if necessary.”

Analysts have taken note of China’s silence on the Putin-Kim talks. They said China is cautiously managing the situation and is reluctant to be drawn into the controversy as the world eyes the arms deal talks between North Korea and Russia.

“China does not have to broadcast its position” on the summit meeting between leaders from North Korea and Russia, and therefore highlights “the tensions amid the Ukraine war” as China prepares to host the Asian Games in Hangzhou, according to Jung Dae-jin who is director of Han Peace Institute at Halla University in South Korea.

Others, including Professor Lee Byong-Chol from Kyungnam University’s Institute for Far Eastern Studies, question whether Russia is willing to provide North Korea with very advanced technology.

Lee told VOA Wednesday that Russia will transfer technology to North Korea, as requested by Kim, but Moscow will only transfer very basic technology.

Russian media reported that Kim and Putin had no plans to sign official documents after concluding their one-on-one meeting. Kremlin spokesman Dmitry Peskov said on Wednesday the talks were “important and substantive.”

Kim held his first summit meeting with Putin on April 25, 2019, at the Russian port city of Vladivostok.

Cindy Saine and Lee Juhyun contributed to this report.