In the second quarter of 2024, Saudi Arabia’s non-oil activities saw an impressive growth of 4.9 percent year-on-year, as per data from the General Authority for Statistics (GASTAT). This growth was mainly driven by gains in the financial and insurance sectors, with a surge of 7.1 percent compared to the same period last year. The non-oil sector also saw a 2.1 percent increase compared to the previous quarter, showcasing the Kingdom’s efforts to diversify its economic base. This growth falls in line with Saudi Arabia’s Vision 2030, a strategic plan aimed at reducing the country’s dependence on oil revenues.
Saudi Arabia’s seasonally adjusted gross domestic product (GDP) also saw a rise of 1.4 percent in the second quarter compared to the first quarter. However, there was a slight year-on-year decline of 0.3 percent, mainly due to an 8.9 percent drop in oil activities following the Kingdom’s decision to cut crude output in alignment with OPEC+ agreements. The country reduced oil production by 500,000 barrels per day in April 2023, a reduction that has been extended until December 2024. Despite this, Saudi Arabia’s GDP at current prices reached SR1.02 trillion ($270 billion) in the second quarter.
According to GASTAT, crude oil and natural gas activities contributed the highest to the GDP at 23.2 percent, followed by government activities at 16 percent, and wholesale and retail trade, restaurants, and hotels activities with a contribution of 10.1 percent. Government activities showed a 3.6 percent year-on-year increase and a 2.3 percent quarter-on-quarter increase. Electricity, gas, and water activities witnessed an 8.9 percent rise year-on-year, while wholesale and retail trade, restaurants, and hotels grew by 6.8 percent. Additionally, government final consumption expenditure rose by 10.9 percent year-on-year and 4.3 percent quarter-on-quarter.
Gross fixed capital formation increased by 3.2 percent in the second quarter compared to the same period last year, indicating continued investments in key sectors such as financial services, infrastructure, and energy in Saudi Arabia. The Kingdom remains focused on achieving the objectives outlined in its Vision 2030 blueprint. Overall, the positive growth in non-oil activities reflects Saudi Arabia’s commitment to diversifying its economy and reducing its reliance on oil revenues. With ongoing investments and strategic planning, the country aims to achieve long-term sustainable growth and economic stability.
