• Sun. Apr 21st, 2024

Saudi Arabia Shifts Away from Relying on Oil: Non-Oil Sector Accounts for 50% of GDP

BySamantha Nguyen

Apr 2, 2024
Saudi Arabia Reaches a Milestone in Diversifying Away from Oil-Based Economy

Saudi Arabia’s economy is undergoing a significant shift away from reliance on oil, with the non-oil sector accounting for 50% of the country’s GDP for the first time in 2023. This marks a significant milestone in the country’s diversification efforts and moves towards achieving the goals set out in Vision 2030, which aims to reduce dependency on fossil fuels.

Government data shows that the non-oil sector achieved a real GDP growth rate of 4.4% last year, reaching approximately 1.7 trillion Saudi riyals. This growth is supported by incentives introduced by the government to promote the growth of services and manufacturing industries, which are seen as vital for creating job opportunities for the country’s young and educated population.

Private consumption in sectors like entertainment, hospitality, and tourism drove much of the non-oil sector’s growth last year, accounting for 40% of economic activity. The tourism sector, in particular, has seen significant growth with $13 billion in private investments and attracting millions of visitors both domestically and internationally.

Despite these achievements, Saudi Arabia experienced a 4.3% decline in real GDP in 2023, primarily due to reduced activity in the oil sector caused by production cuts by OPEC countries. Mining and quarrying remain crucial sectors for the country, accounting for one-third of total non-oil output, while manufacturing, real estate, and construction also make significant contributions to the economy. Overall, Saudi Arabia is making progress towards economic diversification and reducing its dependence on oil revenues.

In addition to promoting economic diversification efforts towards reducing dependence on fossil fuels, Saudi Arabia has also been focusing on investing heavily in infrastructure development projects such as new airports and highways to support economic growth.

Furthermore, Saudi Arabia is also implementing policies aimed at increasing foreign investment into its economy by streamlining regulations and improving transparency.

Overall

By Samantha Nguyen

As a content writer at newsqwe.com, I am passionate about crafting engaging and informative articles that captivate our audience. With a background in journalism and a keen eye for detail, I strive to deliver content that is not only well-researched but also adds value to our readers' lives. From breaking news stories to in-depth features, I take pride in my ability to tell compelling stories that resonate with our diverse audience. When I'm not typing away at my keyboard, you can find me exploring new cafes, practicing yoga, or getting lost in a good book. I am thrilled to be a part of the newsqwe.com team and look forward to sharing my love for writing with all of our readers.

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