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Saudi Arabia's non-oil sector sees expansion of 4.9 percent in Q2
(MENAFN) In the second quarter of 2024, Saudi Arabia's non-oil sector experienced a robust expansion of 4.9 percent compared to the same period last year, driven primarily by significant gains in the financial and insurance sectors. According to data from the General Authority for Statistics, the financial, insurance, and business services sectors saw a notable increase of 7.1 percent year-on-year. This growth reflects the Kingdom's ongoing efforts to diversify its Economy beyond oil revenues and align with its Vision 2030 strategic plan.
The non-oil sector's expansion also registered a quarter-on-quarter increase of 2.1 percent, indicating a steady upward trajectory in economic activities unrelated to oil. This growth is part of Saudi Arabia's broader strategy to reduce dependence on oil and foster a more diverse economic base. The continued progress in non-oil sectors is a positive sign of the Kingdom's economic diversification efforts.
However, the overall gross domestic product (GDP) for Saudi Arabia, when seasonally adjusted, showed a modest increase of 1.4 percent in the second quarter compared to the first quarter. On a year-on-year basis, GDP saw a slight decline of 0.3 percent, largely due to an 8.9 percent drop in oil-related activities. This decrease in oil output was a result of Saudi Arabia's decision to cut crude production by 500,000 barrels per day in April 2023, in line with OPEC+ agreements, with the reduction extended through December 2024.
The report further highlighted that Saudi Arabia's GDP at current prices reached 1.02 trillion Saudi Riyals (USD270 billion) in the second quarter. The contributions to GDP were led by crude oil and natural gas activities, which accounted for 23.2 percent, followed by government activities at 16 percent, and wholesale and retail trade, restaurants, and hotels at 10.1 percent. Additionally, government activities saw a 3.6 percent increase year-on-year and a 2.3 percent rise quarter-on-quarter. Meanwhile, electricity, gas, and water activities grew by 8.9 percent year-on-year, and the wholesale and retail trade, restaurants, and hotels sector expanded by 6.8 percent.
The non-oil sector's expansion also registered a quarter-on-quarter increase of 2.1 percent, indicating a steady upward trajectory in economic activities unrelated to oil. This growth is part of Saudi Arabia's broader strategy to reduce dependence on oil and foster a more diverse economic base. The continued progress in non-oil sectors is a positive sign of the Kingdom's economic diversification efforts.
However, the overall gross domestic product (GDP) for Saudi Arabia, when seasonally adjusted, showed a modest increase of 1.4 percent in the second quarter compared to the first quarter. On a year-on-year basis, GDP saw a slight decline of 0.3 percent, largely due to an 8.9 percent drop in oil-related activities. This decrease in oil output was a result of Saudi Arabia's decision to cut crude production by 500,000 barrels per day in April 2023, in line with OPEC+ agreements, with the reduction extended through December 2024.
The report further highlighted that Saudi Arabia's GDP at current prices reached 1.02 trillion Saudi Riyals (USD270 billion) in the second quarter. The contributions to GDP were led by crude oil and natural gas activities, which accounted for 23.2 percent, followed by government activities at 16 percent, and wholesale and retail trade, restaurants, and hotels at 10.1 percent. Additionally, government activities saw a 3.6 percent increase year-on-year and a 2.3 percent rise quarter-on-quarter. Meanwhile, electricity, gas, and water activities grew by 8.9 percent year-on-year, and the wholesale and retail trade, restaurants, and hotels sector expanded by 6.8 percent.
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