Saudi Arabia's upcoming voluntary pension and savings scheme, open to Saudis and foreign workers, which aims at increasing household savings and potentially reduce remittance outflows is welcome, the International Monetary Fund (IMF) has said.
The IMF said this in its latest Article IV consultation report on Saudi Arabia. Under Article IV of the IMF’s Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country's economic developments and policies. On 28 July 2025, the IMF executive board completed the Article IV Consultation for Saudi Arabia.
The proposed voluntary pension and savings scheme will follow major pension reforms in the kingdom approved in July 2024, which raise the retirement age, required contribution periods, and contribution rates while tightening pension benefits.
More specifically, the statutory retirement age is to be raised gradually from 58 to 65 years. This is to ensure the sustainability of the pension system and reflect the longer life expectancy in the country, which increased from 52 years old in 1969 to 78 in 2022. The reforms also equalise the retirement age between men and women, and enhance the adequacy of pensions for women retirees. The required contribution period for early retirement is extended from 25 to 30 years, to encourage longer workforce participation.
Executive board assessment
The IMF report said the newly implemented pension reform should strengthen long-term fiscal sustainability.
“Though immediate fiscal savings are unlikely as the system is currently balanced, its medium-term impact should be fully accounted for and communicated. The upcoming voluntary pension and savings scheme, open to Saudis and foreign workers, which aims at increasing household savings and potentially reducing remittance outflows, is welcome,” the report said.
Currently, the General Organisation for Social Insurance (GOSI) operates a pension plan for Saudi (and other Gulf Cooperation Council) nationals only. There is no pension for foreign national employees.