The Financial Stability Report 2024, released by the Saudi Central Bank (SAMA), revealed that the share of non-oil activities in the overall gross domestic product (GDP) of Saudi Arabia recorded a growth of 4.4 percent, reaching 49.9 percent in the year 2023. Despite global economic uncertainties, the report highlighted that the Saudi economy has proven to be resilient, supported by a robust financial sector. This growth is attributed to the Kingdom’s significant progress towards achieving the ambitious objectives of Vision 2030, which aims to diversify the economy and reduce its reliance on oil.
In 2023, the Saudi banking sector remained well-capitalized with a capital adequacy ratio of 20.1 percent. Banks maintained sufficient lending capacity to support the Kingdom’s economic development, with banking credit continuing to grow. Corporate credit saw an increase of 13.2 percent, driving the growth in the sector. Non-banking financial institutions also performed strongly in 2023, with lending by finance companies increasing by 12.3 percent to reach SR84.7 billion, further supporting the growth in total assets.
The report also highlighted SAMA’s efforts to enable innovative payment solutions while ensuring a secure environment to mitigate associated risks. The Financial Stability Report 2024 can be accessed on SAMA’s website through the provided link. This report underscores the Kingdom’s commitment to economic diversification and financial stability, as well as its progress towards achieving the goals outlined in Vision 2030. The growth in non-oil activities in the GDP signals a positive trajectory for the Saudi economy and reflects its resilience in the face of global economic challenges.
The report’s findings indicate a positive outlook for the Saudi economy, with non-oil activities playing an increasingly significant role in driving growth. The Kingdom’s efforts to diversify its economy and reduce its reliance on oil are yielding results, with the share of non-oil activities in overall GDP reaching 49.9 percent in 2023. The banking sector’s strong performance, coupled with the growth in non-banking financial institutions, is further supporting economic development and stability in the Kingdom.
SAMA’s focus on innovative payment solutions and ensuring a secure environment for financial transactions reflects its commitment to supporting a modern and efficient financial system. These efforts are essential in promoting economic growth and stability, as well as attracting foreign investment. The Financial Stability Report 2024 serves as a testament to the Kingdom’s progress towards achieving its economic goals and ensuring a sustainable and resilient financial system.
Overall, the Financial Stability Report 2024 paints a positive picture of the Saudi economy’s resilience and stability, despite global economic uncertainties. The growth in non-oil activities and the strong performance of the banking and non-banking financial sectors are key drivers of economic development in the Kingdom. SAMA’s efforts to promote innovative payment solutions and mitigate risks further support the growth and stability of the financial system. With continued focus on economic diversification and financial stability, Saudi Arabia is poised to achieve its ambitious goals outlined in Vision 2030.
