Kingdom’s economy expands by 1.3%, driven by robust non-oil activities and government initiatives, reports Saudi’s General Authority for Statistics.
RIYADH, Saudi Arabia.—The General Authority for Statistics (GASTAT) has reported a 1.3% increase in Saudi Arabia’s real Gross Domestic Product (GDP) for 2024, marking the highest annual growth in two years. This upturn is largely attributed to a 4.3% surge in non-oil activities and a 2.6% rise in government services, underscoring the Kingdom’s ongoing efforts to diversify its economy under the Vision 2030 initiative.
Despite a 4.5% decline in oil-related activities, the non-oil sector’s robust performance highlights the effectiveness of diversification strategies. In the fourth quarter of 2024, the economy experienced a 4.5% year-on-year growth, with non-oil activities increasing by 4.7%, oil activities by 3.4%, and government services by 2.2%.
The Vision 2030 programme, introduced by Crown Prince Mohammed bin Salman in 2016, aims to reduce the Kingdom’s dependence on oil by enhancing sectors such as tourism, entertainment, and technology. This strategic shift is reflected in the recent GDP figures, indicating a positive trajectory towards a more diversified and sustainable economy.
The International Monetary Fund projects a 1.5% GDP growth for Saudi Arabia in 2025, while a Reuters poll estimates a 1.3% increase. These conservative forecasts are influenced by anticipated low oil prices, which may impact government revenues. However, the Kingdom’s commitment to economic diversification is expected to mitigate potential challenges.
In line with these developments, the OPEC+ alliance, led by Saudi Arabia and Russia, plans to raise oil production starting April 2025, following a series of cuts initiated in 2022 to stabilize the market. This decision reflects the Kingdom’s proactive approach to balancing global oil supply and demand dynamics.
The Kingdom’s stock market has also responded positively, ending a three-day losing streak with a 0.2% increase, driven by a rise in oil prices. This rebound was bolstered by a 1.5% uptick in Saudi Aramco’s shares, despite the company’s recent announcement of a decline in annual profit and a plan to reduce dividend payouts by almost a third to $85.4 billion.
These economic indicators collectively highlight Saudi Arabia’s resilience and the effectiveness of its diversification efforts, positioning the Kingdom for sustainable growth in the coming years.
Source: General Authority for Statistics, Saudi Arabia
