Saudi Gazette report

RIYADH — Saudi Arabia is preparing to announce a new voluntary pension and savings program that will be open to both Saudi and foreign workers, according to the International Monetary Fund’s (IMF) latest Article IV consultation report, cited by Al-Eqtisadiah newspaper.

The program is designed to boost household savings and is expected to help curb the outflow of workers’ remittances abroad. The Public Pension and Savings Program is anticipated to be unveiled soon.

Foreign remittances from Saudi Arabia rose 14 percent last year to SR144.2 billion ($38.4 billion). Over the past decade (2015–2024), they totaled SR1.43 trillion.

As of the first quarter of 2025, Saudi Arabia had 12.8 million subscribers in the social insurance system, 77 percent of whom — nearly 10 million — were expatriates.

The IMF report noted that recently implemented pension reforms, approved in July 2024, are expected to strengthen long-term financial sustainability. These reforms included raising the retirement age, extending contribution periods, increasing contribution rates, and restricting pension benefits.

While the changes are unlikely to generate immediate fiscal savings since the system is currently balanced, the IMF stressed the need to fully assess and disclose the medium-term impact.

The upcoming voluntary pension and savings program, open to both Saudis and expatriates, was described as a welcome step that could significantly enhance household savings and reduce external remittances.

The IMF also highlighted the size of GOSI’s assets, which amount to 32 percent of Saudi Arabia’s GDP, underscoring the importance of improving transparency through stronger financial disclosures and clearer allocation rules.