Saudi Arabia says GDP grew 1.3pc in 2024, lifted by non-oil sector
Business
GDP growth surged 4.4% in the fourth quarter
ABU DHABI (Reuters) - Saudi Arabia's economy returned to growth in 2024, with real gross domestic product increasing 1.3% compared to the previous year, preliminary government data released on Thursday showed, with non-oil sector activities lifting overall GDP.
GDP growth surged 4.4% in the fourth quarter versus the same period a year earlier, estimates from the General Authority for Statistics showed, the highest quarterly growth rate in two years, with non-oil activity increasing 4.6%.
Non-oil growth vastly outperformed overall GDP in 2024 as well, increasing 4.3% while oil activities declined 4.5% and government activities grew 2.6%.
The Saudi economy contracted 0.8% in 2023 as oil production cuts and lower oil prices hit growth in the world's biggest crude exporter.
Extended cuts to oil production among the OPEC+ member states, of which Saudi Arabia is a top member, have continued to weigh on GDP growth in the kingdom.
The International Monetary Fund (IMF) has lowered its 2025 GDP growth projection for Saudi Arabia to 3.3%, mainly due to extended oil production cuts, while also trimming its forecast for 2026.
It had estimated 2024 growth for the Gulf state at 1.4%, above the Saudi government's own estimate of 0.8%.
"We need to be careful when we look at GDP as a measure for growth, because you need to look at other indicators," Finance Minister Mohammed al Jadaan said during the World Economic Forum in Davos earlier this month.
"The total GDP number doesn't really matter. Our focus is really the non-oil GDP and non-oil GDP has been growing very healthily over the last few years; we are likely to see that growth escalating in the medium term."
The kingdom, host to major global sporting events in the next decade, is under tight deadlines to deliver on massive infrastructure projects as part of its economic transformation objectives to wean itself off hydrocarbon income.
It has forecast a fiscal deficit of $27 billion in 2025 and foresees a deficit equivalent to about 3% of GDP over the next few years as it boosts spending and investments in domestic projects.
