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Saudi better placed to smooth non-oil slowdown

The most frequent question we received from clients during recent meetings in the Gulf was whether lower oil prices would lead to a sharp slowdown in Saudi Arabia’s non-oil sector akin to that in 2014-16. We do expect fiscal consolidation to lead to notably weaker growth in the non-oil economy, but policymakers now have more tools to make the slowdown much more gradual and less disruptive.

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