SAUDI ARABIA: ENHANCED RELATIONS WITH IRAN IMPROVES SECURITY AND ECONOMIC OUTLOOK

   Fri, 17 March 2023

After years of hostility, Iran and Saudi Arabia have agreed to re-establish relations. The normalisation agreement, brokered by China, lowers the risk of direct military confrontations between the two countries, and could pave the way for talks around other conflict hotspots in the region. However, it does not resolve the fundamental differences between Saudi Arabia and Iran. Nonetheless, this comes as a positive development for the kingdom as it aims to ride on the momentum from 2022’s stellar economic growth fuelled by a robust expansion of the non-oil sector and sustained oil activity.