RIYADH: Global economic growth is set to accelerate in 2025 as monetary easing, US resilience, and recoveries in Europe and China drive momentum, with Southeast Asian economies benefiting from positive spillovers.

The Qatar National Bank projects a 3.2 percent global growth rate, outpacing Bloomberg’s consensus of 3.1 percent, the state’s news agency QNA reported.

In its latest commentary, QNB anticipates growth in major economies, driven by controlled inflation, eased financial constraints, and policy adjustments by central banks. Emerging markets, specifically the Association of Southeast Asian Nations economies, are set to benefit from these advancements.

The report said that analysts have consistently underestimated global economic performance, as initial projections for 2023 and 2024 fell short of realized growth by 80 and 40 basis points, respectively.

“Analysts and economists have been proving to be over pessimistic when it comes to forecasting major economies and global growth in recent years,” reported QNA.

The national bank added: “In fact, over the last two years, initial expectations for growth were 80 basis points and 40 bps below realized growth in 2023 and 2024, respectively.”

It forecasts the US Federal Reserve to cut rates by 75 bps and the European Central Bank by 150 bps.

“This should support further investment and consumption growth, as credit becomes cheaper, new investment opportunities become more attractive, and the opportunity costs of spending decrease,” it added.

In the US, QNB predicts growth of 2.2 percent in 2025, down from 2.6 percent in 2024 but still above the long-term average of 2.3 percent.

“The US economy is expected to remain on a strong footing as labor markets are resilient, productivity is growing rapidly with fast technology adoption, and households have robust balance sheets with the strongest financial position in decades,” QNB said.

Europe and China are expected to recover from extended periods of stagnation. Growth in the European area is forecast to rise from 0.7 percent in 2024 to 1.0 percent in 2025, supported by lower energy prices and a rebound in global manufacturing demand.

China’s growth is projected to increase from 4.8 percent to 5.0 percent, driven by policy easing and renewed economic momentum.

Emerging Asian nations, particularly ASEAN economies, are set to benefit significantly. “Stronger growth in China is likely to be a significant tailwind to emerging Asia in general and ASEAN economies in particular,” QNB said.

The region’s five largest markets, including Indonesia, Malaysia, the Philippines, Singapore, and Thailand, are forecasted to grow by 5.2 percent in 2025, up from 4.4 percent in 2024.

“All in all, we expect to see a moderate acceleration of global growth in 2025, with significant monetary easing, a resilient US economy, a cyclical recovery in Europe and China, and positive spillovers to ASEAN economies,” QNB said.

RIYADH: Saudi Arabia’s water sector witnessed significant shifts in 2023, with a 31 percent increase in desalinated seawater production, now comprising 50 percent of the country’s distributed water supply, up from 44 percent in 2022, official data showed. 

According to the General Authority for Statistics’ latest Water Accounts report, non-renewable groundwater consumption by the agricultural sector dropped by 7 percent to 9,356 million cubic meters, compared to 10,044 million m³ in 2022. 

This surge reflects the Kingdom’s strategic efforts to bolster sustainable water resources as part of its Vision 2030 agenda, aimed at reducing dependency on non-renewable groundwater.  

In 2023, renewable groundwater abstraction rose to 21 percent of total groundwater use, while non-renewable abstraction fell by 6 percent, aligning with the country’s emphasis on resource preservation. Additionally, water reuse consumption increased by 12 percent to 555 million m³, signaling progress in recycling initiatives. 

Agriculture remained the largest consumer of water, using 12,298 million m³, but its expenditure share accounted for only 0.5 percent of total water costs. Meanwhile, industry dominated water-related expenditures at 61.4 percent, reflecting its significant reliance on distributed water for operations. 

The shift toward desalinated and renewable water sources is pivotal for Saudi Arabia, which faces acute water scarcity challenges. With groundwater resources depleting and the per capita household water consumption declining from 112.8 liters per day in 2022 to 102.1 liters in 2023, the Kingdom’s investments in desalination and reuse technologies underscore its commitment to long-term water security. 

Industrial sectors saw a notable increase in water consumption, with the share of distributed water used by industries rising to 30 percent in 2023 from 22 percent in 2022. This surge mirrors the Kingdom’s push for industrial expansion under Vision 2030, which emphasizes economic diversification. 

Despite these strides, non-renewable groundwater still constitutes 62 percent of the natural water supply, a decline from 68 percent in 2022 but still a dominant figure. The agriculture sector’s significant water use highlights opportunities for adopting more efficient irrigation techniques and exploring crop diversification to enhance sustainability. 

Saudi Arabia’s water strategy is set to play a critical role in achieving its economic and environmental goals. As the Kingdom continues to expand its desalination infrastructure and promote water reuse, it positions itself as a regional leader in tackling water scarcity through innovation and sustainable practices.