Saudi Arabia’s economic growth will slow this year for the first time in a decade because of lower oil production, but the outlook for the economy “remains broadly positive”, according to the International Monetary Fund.

The Saudi economy, the biggest in the Arab world, is likely to shrink by 1 per cent, as gross domestic product from oil revenue is expected to decline by 10.3 per cent, the IMF said in a report on Tuesday. The non-oil sector, however, is likely expand by 3.3 per cent supported by the government’s increased expenditure.