Saudi’s Non-Oil Activities Growth Reflects KSA’s Vision 2030 Success

Saudi Arabia’s pursuit of economic diversification is integral to the long-term sustainability and resilience of its economy. KSA recognizes the need to reduce its reliance on oil revenues, given the volatility of global oil markets and the finite nature of oil resources. Through Vision 2030, Saudi Arabia has adopted a strategy to diversify its economic base, with a focus on expanding Saudi non-oil activities such as manufacturing, tourism, technology, and finance.

Economic Diversification Efforts

Saudi Arabia is exerting significant efforts to achieve the targets of economic diversification and reduce reliance on oil. These efforts, supported by prudent leadership, resulted in non-oil activities accounting for 50% of the real Saudi GDP in 2023, marking the highest level ever recorded.

By diversifying its economy, Saudi Arabia aims to create new sources of revenue. Moreover, it aims to reduce its vulnerability to fluctuations in oil prices and stimulate long-term economic growth and development. KSA’s efforts are underpinned by strategic initiatives. These initiatives are aimed at creating an enabling environment for private sector growth. It also seeks to foster innovation and entrepreneurship as well as attracting foreign investment.

Saudi Non-Oil Activities Export Growth

In the third quarter of 2021, the value of Saudi non-oil exports increased by 195 billion riyals, a 33% rise compared to the previous year. The significant growth in Saudi non-oil exports highlights KSA’s progress in diversifying its economy and reducing oil revenue dependence.

This growth in non-oil exports showcases KSA’s commitment to economic diversification and building competitive international industries. It also reflects the government’s efforts to improve the business environment, enhance trade facilitation measures, and promote entrepreneurship and innovation.

Real GDP Growth

In 2023, the real gross domestic product (GDP) in Saudi Arabia rose by 3.9% in the first quarter compared to the same period in 2022. The sustained growth of Saudi Arabia’s real GDP indicates KSA’s economic resilience and dynamism. Despite challenges such as the COVID-19 pandemic and fluctuations in global oil prices, KSA has continued to experience robust economic growth.

This growth is fueled by increased productivity, investment in infrastructure, and government-led initiatives to stimulate economic activity. As KSA continues to implement reforms and pursue diversification strategies, its economy is expected to remain on a path of steady growth. Consequently, this growth will create new opportunities for businesses and drive prosperity for its citizens.

Growth in Other Sectors

Numerous other sectors also recorded strong growth rates. Among these were accommodation, food services, transportation, and storage, where growth rates reached 77% and 29%, respectively. This underscores significant investment opportunities in service sectors and their high potential to increase growth in the gross domestic product.

Furthermore, Saudi non-oil sectors such as accommodation, food services, and transportation have emerged as key drivers of economic growth. They contribute significantly to job creation, investment, and overall economic output.

Saudi Arabia’s efforts to develop non-oil sectors has three key objectives. Firstly, KSA aims to capitalize on emerging opportunities. Secondly, it seeks to meet the growing demands of a rapidly expanding population. Lastly, it aims to position KSA as a regional hub for trade and investment. By investing in non-oil activities, KSA aims to unlock the full potential of these sectors and drive sustainable economic growth.

Future Economic Prospects

Besides, several experts expects that this economic development and growth will continue and even increase in the coming years, especially with several large-scale projects underway, notably the NEOM project.

Saudi Arabia’s economic prospects remain promising, fueled by ongoing diversification efforts, ambitious development projects, and strategic investments in key sectors. KSA’s Vision 2030 commitment aims for sustained growth and prosperity through a diversified, knowledge-based economy.

With major initiatives and investments in renewable energy, tourism, and technology, Saudi Arabia is well-positioned to capitalize on emerging opportunities and overcome future challenges. By leveraging its strengths, fostering innovation, and embracing global best practices, KSA aims to achieve its vision of becoming a leading global economic powerhouse and a hub for innovation and creativity.

International Recognition of Saudi’s Non-Oil Activities Growth

Moody’s agency forecasted an average economic growth rate of around 3.9% for Saudi Arabia from 2022 to 2026. This forecast stands as a testament to the country’s leadership, smart resource management, future aspirations, and the objectives set by Vision 2030.

Besides, The International Monetary Fund (IMF) raised its projections for Saudi economic growth in 2023 to 3.1%. This is according to its “World Economic Outlook” report for April of the previous year. These endorsements affirm KSA’s progress in implementing Vision 2030 and its commitment to driving sustainable economic development and improving the quality of life for its citizens.

Saudi’s Non-Oil Activities Improve Quality of Life

Furthermore, this ongoing success of non-oil activities contributes to improving the quality of life as per Vision 2030, which includes a program dedicated to enhancing individual and family life quality. By investing in education, healthcare, infrastructure, and social programs, Saudi Arabia aims to create a vibrant and inclusive society where individuals and families can thrive and fulfill their potential. This in return enhances the status of Saudi cities in global rankings.

KSA’s promotion of cultural, entertainment, sports, and tourism activities reflects its commitment to enhancing people’s well-being and happiness. By providing leisure, recreation, and personal development opportunities, Saudi Arabia fosters community, belonging, and national pride. Moreover, through economic diversification and job creation, Saudi Arabia aims to reduce unemployment, alleviate poverty, and improve social mobility.

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