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Economy ME
2 days ago
- Business
- Economy ME
Saudi Arabia's real GDP grows 3.4 percent in Q1 2025, says GASTAT
Saudi Arabia's economy expanded more than expected in the first quarter of 2025, with real GDP achieving a growth rate of 3.4 percent compared to the same quarter of 2024. The latest results beat flash estimates of 2.7 percent released by the Saudi General Authority for Statistics (GASTAT) in May. In its latest report, GASTAT revealed that this growth was driven by a 4.9 percent expansion in non-oil activities, in addition to a 3.2 percent growth in government activities. Earlier this year, the statistics agency expected non-oil growth to reach 4.2 percent. However, oil activities recorded a decline of 0.5 percent, lower than the previously expected 1.4 percent contraction. Meanwhile, seasonally adjusted real GDP rose by 1.1 percent compared to the fourth quarter of 2024. Non-oil sector boosts growth The results showed that non-oil activities were the main driver of the annual real GDP growth, contributing 2.8 percentage points. Additionally, government activities and net taxes on products contributed positively by 0.5 and 0.2 percentage points, respectively. 'It is worth noting that most economic activities achieved positive annual growth rates. Wholesale and retail trade, restaurants, and hotels recorded the highest growth rates during the first quarter of 2025, reaching 8.4 percent year-on-year and 0.7 percent quarter-on-quarter,' added the report. With Saudi Arabia's oil GDP shrinking, the kingdom may face a widening budget deficit, with the International Monetary Fund saying Riyadh needs an oil price of over $90 per barrel to balance its books compared to prices of around $60 per barrel in recent weeks. Saudi Arabia, the world's biggest oil exporter, lowered its July prices for Asian buyers at the beginning of June after OPEC+ raised output for a fourth month. OPEC+ agreed to another big output increase of 411,000 bpd for July, having increased output by the same amount in May and June. Read: Dubai Program for Gaming 2033 propels sector's expansion to over 350 companies Saudi Arabia boosts diversification efforts While Saudi Arabia's oil economy shrank, its non-oil GDP rose 4.9 percent last quarter. Driven by its economic transformation program, Vision 2030, Saudi Arabia aims to decrease the dependence of its economy on oil. In addition, it aims to boost its non-oil revenues by focusing on tourism and sports among other key sectors. Therefore, it will be hosting the 2029 Asian Winter Games, set to feature artificial snow and a man-made freshwater lake, and the 2034 World Cup, for which 11 new stadiums will be built and others renovated. Further boosting GDP growth, Saudi Arabia's non-oil exports rose 13.4 percent annually to SAR81 billion ($21.6 billion) in the first quarter of 2025, according to GASTAT. National non-oil exports, excluding re-exports, increased by 9 percent, while the value of re-exported goods increased by 23.7 percent during the same period. The report also revealed that merchandise exports decreased by 3.2 percent in Q1 2025 compared to Q1 2024, as a result of an 8.4 percent decrease in oil exports. Consequently, the percentage of oil exports out of total exports decreased from 75.9 percent in Q1 2024 to 71.8 percent in Q1 2025. On the other hand, imports increased by 7.3 percent in Q1 2025, and the surplus of the merchandise trade balance decreased by 28 percent compared to Q1 2024
Arabian Business
2 days ago
- Business
- Arabian Business
Saudi Arabia's economy grows 3.4% in Q1 2025 as non-oil sector leads the way
Saudi Arabia's economy expanded by 3.4 per cent in the first quarter of 2025, compared to the same period in 2024, according to new data released by the General Authority for Statistics (GASTAT). The Kingdom's robust economic performance was driven primarily by a 4.9 per cent surge in non-oil activities, alongside a 3.2 per cent increase in government activities. Meanwhile, oil-related activities declined slightly by 0.5 per cent, underscoring the country's ongoing shift towards economic diversification under Vision 2030. Saudi GDP 2025 On a seasonally adjusted basis, real GDP increased by 1.1 per cent compared to the fourth quarter of 2024. GASTAT's report highlighted that non-oil activities were the largest contributors to real GDP growth on an annual basis, adding 2.8 percentage points to the total. Government activities contributed 0.5 percentage points, while net product taxes added a further 0.2 percentage points. Among individual sectors, wholesale and retail trade, restaurants, and hotels stood out with the highest annual growth rate of 8.4 per cent in Q1 2025, and a quarterly growth of 0.7 per cent, reflecting a rebound in consumer demand and tourism activity.
