Our in-depth, independent reports cover the macroeconomic environment, the Saudi government’s annual budget, and Saudi Arabia’s monetary and financial developments, labor market, and inflation.
‘Non-oil Activities’ real GDP growth accelerated to 6.1 percent, year-on-year, in Q2-23, pushing up the average for the past four quarters to 5.9 percent. Meanwhile, ‘Government Activities’, which is separate, eased back to 2.3 percent growth following a spike in Q1-23. Overall GDP growth was weighed down by cuts to oil production, and fell to 1.2 percent from 3.8 percent in Q1.
Saudi Chartbook - September 2023
Saudi Arabia’s current account returned another surplus in Q1-23, albeit one less than half the size of the Q1-22 surplus. A 15 percent year-on-year downturn in oil earnings combined with a 24 percent surge in import spending saw the surplus decline to $17.7 billion, down from almost $40 billion a year earlier.
The Saudi domestic economy continues to grow robustly. Real non-oil GDP expanded by 5.4 percent in Q1-23, with Domestic Trade, Construction, and Transport leading the way. Available data for Q2 indicate that activity in these sectors continues at a brisk pace. Manufacturing was the only sector to record a year-on-year decline, with Refining contracting in the face of soft regional demand, and Petrochemicals exports to China struggling to gain traction. Nevertheless, Saudi domestic Manufacturing demand is strong and new factories continue to be rolled out. Thus, we raise our non-oil GDP growth forecast to 5.9 percent this year, with a similar rate of expansion anticipated for 2024.