With its economy still almost entirely dependent on oil for revenues, the kingdom was never going to avoid the effects of the global recession. At its height, in February this year, oil-dependent economies such as Saudi Arabia were earning $100 less for each barrel of oil than eight months earlier.

But Riyadh’s response to this drop in income has produced results. At the end of last year, the Saudi Arabian Monetary Agency (Sama), the central bank, started to repatriate and monetise its foreign assets, and made five interest rate cuts between October 2008 and February 2009. Much of the resulting cash was pumped directly into the economy to boost liquidity.

The economy is now well on the way to recovery, with predictions for growth in 2010 of up to 4.1 per cent, compared with a fall of about 1.5 per cent this year.

The value of Sama’s net foreign assets rose in October for the first time this year, edging up to SR1.46 trillion from SR1.43 trillion.

Third-quarter results from Saudi private companies show growth and stability in the economy, and are leading to improved business optimism, which should continue building up through 2010.