RIYADH: The Saudi Council of Economic and Development Affairs (CEDA), has formally approved the Financial Sector Development Program, one of the main programs under the umbrella of the Saudi Vision 2030.
The program’s objectives include creating a diversified and effective financial services sector to support the development of the national economy, diversifying its sources of income, and stimulate savings, finance, and investment by addressing the sector’s challenges.
The program is underpinned by three main pillars: enabling financial institutions to support private sector growth, ensuring the formation of an advanced capital market, and promoting and enabling financial planning. These pillars are aligned with the ambitious strategic objectives of Saudi Vision 2030 of diversifying the economy, growing investments to new sectors, supporting emerging sectors and attracting foreign investment.
The new program offers a range of initiatives that have been designed based on thorough studies of the program’s requirements and best international practices. Collectively, the initiatives will offer a diverse suite of products and services that facilitate access to a highly-digitized inclusive financial system that maintains the Kingdom’s financial stability
The first pillar — “enabling financial institutions to support private sector growth” — includes a number of Vision 2030-related initiatives, such as enabling new types of players to enter the market, incentivizing the financial sector to finance Small and Medium-sized Enterprises (SMEs), and driving toward a cashless society.
These initiatives involve a number of measures, including revising and enhancing existing laws and regulations, incentivizing merchants and citizens to adopt e-payment solutions, ensuring enforcement of mandatory vehicle and health insurance, and facilitating mergers and acquisitions within the insurance sector to increase its scale and solvency.
The second pillar — “ensuring the formation of an advanced capital market” — aims to make the Saudi financial market more attractive to local and international investors through a number of initiatives that will see more diversified investment products and developed legislations. The program will also encourage the privatization of some state-owned services and entities, thus further deepening the equity market and increasing market capitalization, while at the same time improving service quality and spending efficiency. The program’s initiatives also involve the development of several regulatory aspects related to the debt facilities market to deepen the debt market.
The third and final pillar — “promoting and enabling financial planning” focuses on boosting the demand and supply-sides of savings to bolster the Kingdom’s savings ecosystem. This involves creating incentives to offer a diverse range of lucrative and safe savings products and, at the same time, increasing awareness and promoting financial literacy and planning. This, in turn, is expected to encourage banks to diversify their savings offerings to reach a wider customer base. A number of the planned savings products will be backed by the government and designed to help citizens achieve certain long-term goals, such as their children’s future expenses, supplementary retirement income, and affordable home ownership.
The Financial Sector Development Program fits within Vision 2030‘s objectives of raising Saudi households’ savings rate to 10% of their disposable income, thereby helping citizens boost their savings rates and safely invest those savings to supplement their income. By 2020, the program also seeks to increase the total size of financial assets to GDP ratio to 201%, increase the number of adults who have bank accounts from 74% to 80%, increase SMEs’ share of total bank loans to 5% and generate high-paying jobs in the financial sector.
Saudi Arabia’s Council of Economic and Development Affairs approves Financial Sector’s Development Program 2020
Saudi Arabia’s Council of Economic and Development Affairs approves Financial Sector’s Development Program 2020
- The Financial Sector Development Program is one of the main programs under the umbrella of the Saudi Vision 2030
- The program aims to create a diversified and effective financial services sector to support the development of the national economy
S&P affirms UAE sovereign credit ratings at AA/A-1+ amid regional tensions
JEDDAH: The UAE’s sovereign credit ratings have been affirmed at AA/A-1+ with a stable outlook, as S&P Global Ratings highlighted the country’s strong fiscal buffers, diversified economy, and policy flexibility in the face of escalating regional conflict.
The agency cited the UAE’s consolidated net assets, estimated at 184 percent of gross domestic product in 2026, and its low general government debt of around 27 percent of GDP, as key buffers against economic shocks.
Sovereign credit ratings play a key role in determining a country’s borrowing costs and investor demand for its debt. A high rating signals strong fiscal health and policy stability, helping governments attract foreign investment and access global capital markets at favorable terms.
S&P noted that “our baseline forecasts carry a significant amount of uncertainty” amid heightened tensions involving Iran, Israel, and the US, including potential threats to key infrastructure.
The report added: “We also believe the authorities will deploy their substantial policy flexibility to counteract the effects of volatility stemming from geopolitical tensions in the Gulf region on economic growth, government revenue, and its external accounts.
“We believe this flexibility will enable the UAE to withstand periods of low oil prices and, more importantly, the temporary disruption of oil production and export routes.”
The UAE is facing a tense geopolitical environment amid escalating Iran-Israel-US conflicts. Threats around the Strait of Hormuz have nearly stopped vessel traffic, fueling oil market volatility and investor concern.
The ratings agency also emphasized the UAE’s diversified economic base, with non-oil sectors accounting for roughly 75 percent of GDP, as a stabilizing factor.
Strategic infrastructure, including the Abu Dhabi Crude Oil Pipeline to Fujairah, enables the country to bypass the Strait of Hormuz and safeguard oil exports, while ADNOC’s overseas storage investments further mitigate risk.
Despite the risks, S&P expects sectors such as financial services, trade, and tourism to remain resilient. It forecasts that UAE growth will moderate to 2.2 percent in 2026, down from 5 percent in 2025, reflecting potential impacts from expatriate outflows, reduced tourism revenue, and lower real estate demand.
S&P cautioned, however, that “we now expect weaker economic and external performance due to increased intensity, scope, and potential duration of conflict in the Middle East,” underscoring that prolonged disruption could weigh on fiscal and external accounts.
The affirmation underscores investor confidence in the UAE’s ability to navigate short-term geopolitical challenges while maintaining long-term stability. Analysts said the country’s large liquid asset buffer and effective policy tools will likely contain the credit impact of regional tensions and support continued economic growth.
The UAE has consistently maintained strong and stable sovereign credit ratings, reflecting a resilient and diversified economy, as well as prudent fiscal management.
Despite occasional caution during regional tensions or oil market swings, ratings have remained high, underscoring the country’s policy flexibility, fiscal strength, and appeal to global investors.
