The report noted that non-oil companies increased their labor force over the month, with the rate of job creation rising to a three-month high. Shutterstock
RIYADH: The UAE’s non-oil private sector growth remained steady in May, with the country’s Purchasing Managers’ Index holding firm at 55.4, unchanged from the previous month, an economy tracker showed.
According to an S&P Global report, non-oil companies in the Emirates experienced a record increase in outstanding business levels in May. Robust sales pipelines and the lingering impact of April’s flooding crisis significantly pressured business capacity.
David Owen, senior economist at S&P Global Market Intelligence, said: “UAE non-oil companies continued to face relentless pressure on business capacity in May, as the latest PMI survey data signaled the largest-ever increase in backlogs of work.”
He added: “Although the uplift can be partly blamed on the country’s record rainfall event in April and subsequent flooding, capacity pressures were already at historic levels in March amid robust sales pipelines and supply chain challenges due to the Red Sea crisis.”
In March, the UAE’s PMI stood at 56.9, following 57.1 in February and 56.6 in January.
S&P Global noted that any PMI reading above 50 indicates growth in the non-oil sector, while readings below 50 signal contraction.
“The PMI was unchanged from April’s eight-month low of 55.3 in May. However, the reading was still above its long-run average of 54.4 and indicative of a robust improvement in operating conditions,” the report stated.
The survey also highlighted increased input demand and the need to replenish stocks, leading to intensified price pressures in May. Input costs rose at the sharpest rate in nearly two years, prompting the fastest uptick in prices since April 2021.
Additionally, the rate of business activity growth softened to a 16-month low, with some companies noting operational disruptions.
“The findings suggest that firms have a lot of work to do to get on top of their workloads, including rebuilding output levels, hiring workers and boosting inventories. May data signals that hiring and purchasing efforts did pick up, though with the added effect of contributing to higher inflationary pressures,” said Owen.
He further highlighted that output growth dropped to a 16-month low in May, with some firms reporting that their operations were still on hold.
The report noted that non-oil companies increased their labor force over the month, with the rate of job creation rising to a three-month high.
Similarly, purchasing growth also strengthened, reaching its highest level since last November amid robust sales pipelines and output requirements.
“As such, the focus for the next few months looks to be the recovery of the sector from this crisis. Nonetheless, with demand still strong, firms should be in a good position to resume their robust growth once capacity has been restored,” added Owen.
Kingdom’s mineral wealth valued at $2.5tn, positioning mining as a third pillar of the national economy
Updated 07 March 2026
Ghadi Joudah
RIYADH: Saudi Arabia is accelerating its push into mining as part of its economic transformation under Vision 2030, amid the growing importance of critical minerals and rare earths.
The Kingdom’s mineral wealth is valued at $2.5 trillion, positioning mining as a third pillar of the national economy alongside hydrocarbons.
The mining industry could give Saudi Arabia an edge in transition minerals and supply chains by expanding extraction, processing and the logistics needed to move materials to market, according to economists and industry specialists.
Saudi Arabia is home to more than 45 identified minerals, including gold, copper and uranium, according to the Vision 2030 strategy.
Momentum has been supported by measures aimed at making mining easier to invest in and faster to scale, including updated regulations, digital licensing platforms, specialized mining services, and new transport and rail links to mining areas.
Vision 2030 aims to raise mining’s contribution to gross domestic product to SR240 billion ($63 billion) by 2030, create 200,000 direct and indirect jobs, and attract $27 billion in new investment, according to published government targets.
Signs of progress are starting to show in the mining sector in terms of exploration activity, licensing and new discoveries.
“The mining strategy shows it’s working very well, evidenced by the rapid rise in exploration and industrial licenses, and major new mineral discoveries,” Talat Hafiz, an economist and financial analyst, told Arab News.
Saudi Arabia is undertaking the world’s largest geological survey, covering about 700,000 sq. km of the Arabian Shield for $1.5 billion, he said.
The number of mining licenses issued exceeds 2,000, according to official data, and the Kingdom’s mineral wealth is valued at 90 percent higher than it was in 2016 when Vision 2030 was rolled out.
A key milestone highlighted in Vision 2030’s mining strategy was the introduction of a new mining investment law, which reduced the tax rate to 20 percent from 45 percent to spur investment and align the sector with global standards.
The Kingdom’s mining resources position it well to be a critical supplier of raw materials that are integral to energy transition as clean-energy technologies require large volumes of mined materials.
Copper is central to electrification and power networks, while battery supply chains rely on minerals such as nickel and lithium. Phosphate is a key industrial input with wider economic value.
Reliable supplies of metals and minerals used in power grids, batteries and electric vehicles can attract investment and support downstream industry in the Kingdom.
Saudi Arabia’s Jabal Sayid site, northeast of Jeddah, ranks among the world’s top four resources for rare earth elements, Khalid Al-Mudaifer, vice minister of industry and mineral resources for mining affairs, recently told Al Eqtisadiah.
It will help meet Saudi Arabia’s needs for minerals used in magnet manufacturing, EVs and wind energy, while also supporting global supply, including the US market, he said.
Mining can also catalyze investment in the Kingdom, widen supply-chain employment, and boost non-oil exports and private-sector growth, according to economists and policymakers.
Mines, processing plants and the infrastructure around them require large upfront capital spending, creating a pipeline of work across construction, equipment, utilities and logistics.
The mining industry could give Saudi Arabia an edge in transition minerals and supply chains by expanding extraction, processing and the logistics needed to move materials to market. (Shutterstock)
“When a mining sector scales, the economic footprint extends well beyond extraction,” said Turki Al-Nahari, vice president of global mining at Ecolab, told Arab News. “Growth typically occurs across engineering services, industrial water management, logistics, laboratory testing, equipment reliability, environmental services and digital performance systems.
“That shift creates demand for skilled engineers, technicians, data analysts and operational specialists,” he added.
In 2025, Saudi Arabia’s mining exploration budget increased 600 percent to $146 million from $21 million in 2022.
“This growth is driven by ongoing geological surveys, technological advancements and higher exploitation budgets, all of which signal stability and opportunity, attracting foreign investment,” Manraj Lamba, a mining economics analyst at S&P Global, said in a recent report.
Mining projects are easier to finance when the size and quality of the deposit are clear, costs are competitive, and rules and taxes are stable, Abdullah Al-Harbi, an economist familiar with the industry, told Arab News.
Investors want solid feasibility work, credible timelines and evidence a project can stay profitable through swings in commodity prices, Al-Harbi said.
Saudi Arabia’s pipeline includes 24 exploration-stage projects and 17 more advanced developments, according to S&P Global.
“Its proactive approach to geological surveys and resource assessment has uncovered significant potential across gold, copper, phosphate and bauxite,” Lamba said.
Large projects also tend to generate employment across a wider industrial supply chain, including contractors, maintenance, laboratories, transport and a range of operational services.
To boost employment and support hiring and training, Saudi Arabia has moved to standardize job roles and skills for the mining industry.
HIGHLIGHT
Vision 2030 aims to raise mining’s contribution to gross domestic product to SR240 billion ($63 billion) by 2030, create 200,000 direct and indirect jobs, and attract $27 billion in new investment.
The Kingdom rolled out a framework related to employment and skills in the mining industry in January at the Global Labor Market Conference.
The framework is “a tool which ensures clear definitions of occupations and their required skills,” the Kingdom’s Minister of Industry and Mineral Resources Bandar Al-Khorayef said. It will cover more than 500 job roles, detail the necessary skills, responsibilities and titles, he added.
Exports from the sector are already rising in tandem with investments to develop the industry and create jobs.
Saudi Arabia exported 5.7 million tonnes of phosphate fertilizer in 2024, up about 6 percent from 2023, according to a GASTAT report.
As the energy transition accelerates, Saudi Arabia’s advantage may be strongest beyond extraction alone.
“Saudi Arabia’s most realistic advantage in the accelerating energy transition lies in combining selective mining with strong processing and refining capabilities, supported by its emerging role as a logistics and supply-chain hub,” Hafiz said.
The Kingdom’s position between Africa, Europe, and Asia favors downstream processing and value-added industries, he added.
“Saudi Arabia is prioritizing minerals that are both financeable and strategically aligned with emerging industries such as electric vehicles and clean energy technologies, where markets are clear, and demand is scalable,” Hafiz said.
Aluminum, phosphate, and similar commodities remain a key focus to support local manufacturing, infrastructure development and downstream industries while strengthening export capacity, he said.
“Once construction concludes, the priority shifts to operational stability and performance optimization,” Al-Nahari said.
“Small efficiency gains, applied consistently across large-scale operations, compound materially over time,” influencing cost as well as uptime and competitiveness over the life of a mine, he added.
As the global race toward electrification and decarbonization accelerates, the Kingdom is effectively positioning itself beyond its oil legacy with its strategic commitment to the minerals sector, which will play a critical role in powering the future.
Its investment in exploration, infrastructure, and downstream processing anchor it as a pivotal supplier in the critical minerals and rare earths value chain in the era of energy transition.
