The Saudi Central Bank reports a 2.22% annual rise in official reserve assets, driven by robust foreign reserves and strategic financial management

Saudi foreign reserves in 2024 reached SR1.63 trillion ($435.41 billion) in October, reflecting a 2.22% year-on-year increase and highlighting Saudi Arabia’s ability to maintain fiscal stability amidst global economic challenges. According to the Saudi Central Bank, also known as SAMA, these reserves underscore the strength of its financial buffers.

Foreign reserves formed the lion’s share of these assets, accounting for 94.34% of the total. Currency deposits abroad and investments in foreign securities reached SR1.54 trillion, marking an annual growth of 2.32%. Alongside this, the Kingdom’s special drawing rights (SDRs) saw a 2.09% rise, climbing to SR78.42 billion and constituting 4.8% of total reserves.

SDRs, established by the International Monetary Fund (IMF), play a critical role in global financial stability. Their value is pegged to a mix of key international currencies, including the US dollar, euro, Chinese yuan, Japanese yen, and British pound. As a supplementary liquidity source, SDRs support exchange rate stability, provide units of account and facilitate international trade.

Meanwhile, Saudi Arabia’s reserve position within the IMF stood at SR12.41 billion, reflecting an 8.03% decline. Gold reserves remained static at SR1.62 billion, unchanged since 2008, underscoring their function as a stable but smaller component of the Kingdom’s overall financial strategy.

Saudi Arabia’s strong foreign reserve position acts as a financial safety net, ensuring resilience against economic uncertainties such as fluctuating oil prices, global market volatility, and geopolitical risks. These reserves provide the Kingdom with the flexibility to meet financing needs across various time horizons, safeguarding its fiscal sustainability.

Moreover, Saudi foreign reserves in 2024 continue to strengthen the Kingdom’s credit profile, ensuring favourable borrowing terms in both domestic and international markets. This boosts investor confidence and secures the fiscal foundation needed for ambitious national initiatives.

The strategic management of reserve assets aligns with Saudi Arabia’s Vision 2030 goals, which focus on reducing oil dependency, growing non-oil sectors, and achieving long-term economic sustainability. By combining financial prudence with forward-looking diversification plans, Saudi Arabia is well-positioned to navigate risks while fostering economic growth and stability.