The Kingdom of Saudi Arabia anticipates its non-oil economic sectors to sustain a growth rate above 5 percent in the upcoming years, as shared by Finance Minister Mohammed Al Jadaan. This projection is a slight modification from the formerly anticipated 6 percent growth rate.
Speaking at the Saudi Capital Markets Forum in Riyadh, Al Jadaan highlighted that the Kingdom’s non-oil Gross Domestic Product (GDP) is currently on a robust growth track, with figures surpassing 4 percent. He predicts this trend to continue, with expectations of reaching or exceeding 5 percent growth in the medium term.
The nation, recognized as the leading oil exporter globally, is fast-tracking its efforts to diversify its economy. This initiative, part of the strategic Vision 2030, focuses on enhancing sectors such as tourism and industrial development, fostering the private sector, and generating employment opportunities.
Last year, the non-oil economic activities significantly outpaced the oil sector’s growth, contributing to an overall economic uplift. This was a recovery from the previous economic downturn, which was influenced by reduced oil production and declining prices.
In contrast to the 4.6 percent growth seen in the non-oil GDP for 2023, the overall GDP witnessed a contraction of 0.9 percent. Nevertheless, the government’s budget forecasts anticipate increased expenditure in the coming years, which is expected to stimulate domestic growth and bolster the non-oil GDP. However, this increased spending is also projected to result in a fiscal deficit of around 2 percent for the year.
Al Jadaan expressed confidence in the resilience of the Saudi economy, crediting the country’s comprehensive economic and social reforms. These reforms have effectively managed the budget deficit, reducing it from 15 percent to a manageable figure of approximately 2 percent or less. According to Al Jadaan, these strategic changes have fortified the Kingdom’s ability to cope with external challenges, including the COVID-19 pandemic and geopolitical uncertainties.