Saudi Arabia’s GDP Grows by 1.4% in First Quarter of 2024
In a recent report by the General Authority for Statistics, Saudi Arabia’s real gross domestic product (GDP) saw a 1.4% increase in the first quarter of this year compared to the previous quarter. This growth is a positive sign for the Kingdom’s economy.
Non-Oil Activities on the Rise
The report also highlighted a 0.9% increase in non-oil activities in the first three months of 2024 compared to the previous quarter. Additionally, non-oil activities saw a significant 3.4% year-on-year growth in the first quarter.
GDP Reaches SR1.01 Trillion
Saudi Arabia’s GDP reached a noteworthy SR1.01 trillion ($270 billion) in the first quarter. Crude oil and natural gas activities made the highest contribution to GDP at 23.4%, followed by government activities at 15.8%, and wholesale and retail trade, restaurants, and hotels activities at 10.4%.
Challenges Faced by the Kingdom
Despite the positive growth, the Kingdom’s GDP declined by 1.7% in the first quarter compared to the same period the previous year. This decline underscores the importance of strengthening the non-oil private sector as Saudi Arabia continues to diversify its economy away from oil dependence.
Impact of Oil Production Cuts
Saudi Arabia reduced its crude oil production in line with OPEC+ decisions, leading to a 11.2% year-on-year dip in oil activities. The Kingdom cut its oil output by 500,000 barrels per day in April 2023, and this reduction has been extended until December 2024 to maintain market stability.
Positive Growth Projections
Despite challenges, both the International Monetary Fund and the World Bank have raised their growth projections for Saudi Arabia’s economy. The IMF expects a 2.6% growth in 2024 and 6% in 2025, while the World Bank projects a 5.9% growth in 2025, up from their earlier estimate of 4.2%. These projections indicate a promising outlook for Saudi Arabia’s economic future.