Saudi Arabia GDP growth higher than G20 average: OECD

The report highlighted that while Saudi Arabia experienced a significant recovery, other G20 countries faced varying economic conditions. Shutterstock
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Updated 13 June 2024
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Saudi Arabia GDP growth higher than G20 average: OECD

RIYADH: Saudi Arabia’s economy witnessed growth of 1.4 percent in the first quarter of 2024 – higher than that seen across the G20 as a whole, according to new data.

The Organisation for Economic Co-operation and Development has released its latest gross domestic product report for the G20 countries, noting that the Kingdom bounced back from a contraction of 0.6 percent in the previous three-month period. 

GDP in the G20 area grew by 0.9 percent quarter-on-quarter in the first quarter of 2024, slightly up from 0.7 percent in the previous quarter. 

The economic performance of the G20 area was primarily driven by China and India, with Turkiye, Korea, and Indonesia also recording higher GDP growth than the G20 average. 

Turkiye led with an increase of 2.4 percent, followed by India at 1.9 percent, China at 1.6 percent, Korea at 1.3 percent, and Indonesia at 1.2 percent. 

The report highlighted that while Saudi Arabia experienced a significant recovery, other G20 countries faced varying economic conditions. 

The US saw a slowdown, with GDP growth dropping to 0.3 percent in the first three months of the year from 0.8 percent in the previous quarter. 

Japan’s economy contracted by 0.5 percent, and South Africa saw a contraction of 0.1 percent. 

Conversely, Brazil, the UK, and Germany showed signs of recovery in the first quarter of 2024 after contractions over the previous three month period, with growth reaching 0.8 percent, 0.6 percent, and 0.2 percent, respectively. 

Canada, Mexico, and the EU grew by 0.4 percent, 0.3 percent, and 0.3 percent, respectively, in the three months to the end of March, after zero growth in the final quarter of 2023. 

Year-on-year, GDP in the G20 area grew by 3.3 percent in the first three months of the year, maintaining the same growth rate as the previous quarter. 

Among G20 economies, India recorded the highest year-on-year growth rate at 8.4 percent in the first quarter of 2024, followed by Turkiye at 7.4 percent. 

However, Saudi Arabia recorded the most significant year-on-year decline at a drop of 1.5 percent. 

According to a separate report by the General Authority for Statistics released earlier in June, the Kingdom’s non-oil activities also rose by 0.9 percent in the first three months of this year compared to the previous quarter.  

Additionally, non-oil activities increased by 3.4 percent year-on-year in the first quarter of 2024.  

GASTAT further noted that Saudi Arabia’s GDP amounted to SR1.01 trillion ($270 billion) in the first quarter.  

“Crude oil and natural gas activities achieved the highest contribution to GDP by 23.4 percent, followed by government activities at 15.8 percent, and then wholesale and retail trade, restaurants, and hotels activities with a contribution of 10.4 percent,” said GASTAT in the report.  

Strengthening the non-oil private sector is crucial for Saudi Arabia, as the Kingdom is steadily diversifying its economy to reduce its decades-long dependence on oil.  

The report further noted that government activities in Saudi Arabia rose by 2 percent year-on-year in the first quarter while declining by 1.1 percent on a quarter-on-quarter basis.  

GASTAT added that the Kingdom’s oil activities increased by 1.7 percent in the first quarter compared to the previous quarter.  

However, oil activities dipped by 11.2 percent year-on-year as Saudi Arabia reduced its crude production in line with the decision of the Organization of the Petroleum Exporting Countries and its allies, collectively known as OPEC+.  

To maintain market stability, Saudi Arabia reduced its oil output by 500,000 barrels per day in April 2023, and this cut has now been extended until December 2024.  

In April, the International Monetary Fund projected that Saudi Arabia’s economy would grow by 2.6 percent in 2024 and 6 percent in 2025.  

In the same month, the World Bank also raised the growth prospects of the Kingdom’s economy to 5.9 percent in 2025, up from an earlier projection of 4.2 percent. 

Furthermore, Saudi Arabia’s gross fixed capital formation surged to SR317.5 billion in the first quarter of 2024, marking a significant 7.9 percent increase compared to the same period last year. 

According to a separate report by the Saudi Ministry of Investment released earlier this month, gross fixed capital formation expansion was driven by growth in both the government and non-government sectors.  

GFCF, which represents the net increase in physical assets within an economy, plays a crucial role in gross domestic product as it reflects capital accumulation supporting future production capabilities and economic growth. 

Of the total GFCF, the government sector contributed 7 percent, experiencing a robust growth rate of 18 percent. Meanwhile, the non-government sector, constituting 93 percent, also saw a substantial rise of 7.2 percent. 

Saudi Arabia’s proactive efforts to attract foreign direct investment and bolster bilateral relations have significantly strengthened the Kingdom’s economic trajectory.  

FDI serves as a pivotal catalyst for GFCF development, facilitating funding for investment projects and resource and knowledge transfer across borders, thereby fostering economic expansion and maturation. 

Key initiatives such as the National Investment Strategy, the Regional Headquarters Program, and zero-income tax incentives for foreign entities play a vital role in advancing Vision 2030, which aims to diversify and expand the economy. 

During this quarter, the Ministry of Investment issued 3,157 investment licenses, marking a 93 percent surge compared to the same period last year, excluding licenses issued under the anti-concealment law. 

In its economic and investment monitor released in late May, the ministry revealed that the construction and manufacturing sector dominated with 47 percent of total permits, followed by vocational and educational activities, information and communication technology and accommodation and food services as well as wholesale and retail trade. 

The real estate sector witnessed the most significant year-on-year growth, with a staggering 253.3 percent increase in investment licenses. 

Furthermore, 127 international firms secured permits to relocate their regional headquarters to Saudi Arabia in the first quarter of 2024, reflecting a remarkable 477 percent year-on-year upsurge. 

Leading corporations such as Google, Microsoft and Amazon as well as Northern Trust, Bechtel, IHG Hotels & Resorts, and Deloitte have established operations in the Kingdom under this program. 

The report also highlights that Saudi Arabia processed 445 applications for investor visit visas during the first quarter of this year, enabling overseas businesspersons to explore opportunities in the country. 


Oil Updates — crude set for 2nd weekly rise on trade war truce

Updated 16 May 2025
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Oil Updates — crude set for 2nd weekly rise on trade war truce

BEIJING/SINGAPORE: Oil prices held steady on Friday, heading for a second consecutive weekly gain due to easing US-China trade tensions though a potential return of Iranian supply limited price gains.

Brent crude futures dipped 1 cent to $64.52 a barrel by 6:26 a.m. Saudi time. US West Texas Intermediate crude futures added 2 cents to $61.64.

Both contracts fell more than 2 percent in the previous session following a selloff due to the rising prospect of an Iranian nuclear deal.

President Donald Trump said the US was nearing a nuclear deal with Iran, with Tehran “sort of” agreeing to its terms. However, a source familiar with the talks said there were still issues to resolve.

ING analysts wrote in a note that a nuclear deal lifting sanctions would ease supply risk, allowing Iran to increase oil output and find more willing buyers for its oil. That could result in additional supply of around 400,000 barrels per day, they said.

Despite the potential supply pressure, both Brent and WTI were up 1 percent so far this week, after a surge earlier in the week. Sentiment got a boost after the US and China, the world’s two biggest oil consumers and economies, agreed to a 90-day pause on their trade war during which both sides would sharply lower trade duties.

The hefty reciprocal Sino-US tariffs had raised fears of a sharp blow to global growth and oil demand.

Analysts at BMI, a unit of Fitch Solutions, maintained their forecasts for Brent to average $68 per barrel in 2025 and $71 per barrel in 2026, down from 2024’s $80 per barrel, citing the uncertainty of trade policy on the price outlook.

“While the 90-day cooling off period leaves the door open for additional progress on lowering trade barriers on both sides, the uncertainty on longer-term trade policy will limit price upside,” the analysts said in a research report.

Adding to market concerns was an expected surplus.

The International Energy Agency on Thursday hiked its 2025 global supply growth forecast by 380,000 bpd, as Saudi Arabia and other OPEC+ members unwind output cuts.

The IEA also projected a surplus for next year, despite a minor upward revision of its 2025 global oil demand forecast by 20,000 bpd.

Investors were also watching for signs of interest rate cuts by the Federal Reserve, which could bolster the economy and oil demand.

Earlier this week, data from the US Energy Information Administration showed a bigger-than-expected jump in crude stockpiles, heightening demand concerns in the world’s biggest oil consumer.


Pakistan stocks soar to record high amid budget buzz, IMF tranche

Updated 15 May 2025
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Pakistan stocks soar to record high amid budget buzz, IMF tranche

  • Pakistan this week received second tranche of special drawing rights worth $1,023 million from IMF under EFF program
  • Pakistan’s federal budget for next fiscal year to be finalized within next four weeks, budget talks with IMF from May 14-23

ISLAMABAD: Bulls took charge of the local bourse today, Thursday, as the Pakistan Stock Exchange surged to new heights, fueled by optimism surrounding upcoming budget announcements and the release of a $1 billion tranche by the IMF, analysts said.

Pakistan on Wednesday received the second tranche of special drawing rights worth 760 million ($1,023 million) from the IMF under an extended fund facility (EFF) program. The IMF last week approved a fresh $1.4 billion loan to Pakistan under its climate resilience fund and also approved the first review of its $7 billion program, freeing about $1 billion in cash.

Pakistan’s federal budget for the next fiscal year, starting July, will be finalized within the next four weeks, with scheduled budget talks with the IMF to take place from May 14-23, according to the finance ministry.

The benchmark index witnessed a remarkable intraday rally, climbing as much as 1,453 points before closing with an impressive gain of 1,425 points at 119,961, marking a 1.20% increase and setting a new all-time high.

“Refinery stocks ended the day in the green amid sector-specific developments,” brokerage house Topline Securities said in a daily market review. 

“The government is working to finalize a binding legal framework between oil marketing companies and refineries, with key clauses like take-or-pay aimed at resolving ongoing disputes over product upliftment and HSD imports — a move expected to bring greater clarity and stability to the supply chain.” 

Market participation also picked up, with total traded volume reaching 695 million shares and a traded value of Rs39.01 billion. Pakistan Refinery Limited topped the volume chart with 50.8 million shares traded.

Samiullah Tariq, head of research and development at Pak Kuwait Investment Company Ltd, said the market was positive due to recent inflows from the IMF, noting the “expectations of further inflows on the back of the IMF Board approval.”

Thursday’s bullish momentum also comes as the market continues to recover from upheaval brought by the most intense military row between Pakistan and India in years last week. The two nuclear-armed nations agreed to a US-brokered ceasefire on Saturday. 


Closing Bell: Saudi main index slips to close at 11,485 

Updated 15 May 2025
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Closing Bell: Saudi main index slips to close at 11,485 

RIYADH: Saudi Arabia’s Tadawul All Share Index slipped on Thursday, losing 46.95 points, or 0.41 percent, to close at 11,485.05. 

The total trading turnover of the benchmark index was SR5.28 billion ($1.40 billion), as 61 of the stocks advanced and 179 retreated.  

Similarly, the Kingdom’s parallel market Nomu lost 46.12 points, or 0.17 percent, to close at 27,841.06. This comes as 32 of the listed stocks advanced while 43 retreated.  

The MSCI Tadawul Index lost 4.40 points, or 0.30 percent, to close at 1,462.76.   

The best-performing stock of the day was Miahona Co., whose share price surged 10 percent to SR24.86.  

Other top performers included National Gypsum Co., whose share price rose 4.90 percent to SR21 as well as Saudi Manpower Solutions Co., whose share price surged 3.09 percent to SR7.01. 

Zamil Industrial Investment Co. recorded the most significant drop, falling 10 percent to SR43.20. 

Arabian Contracting Services Co. also saw its stock prices fall 8.21 percent to SR125.20, while Retal Urban Development Co. also saw its share value decline 6.98 percent to SR15.72. 

On the announcements front, Saudi Awwal Bank has completed the offering of its USD-denominated Additional Tier 1 Green Sukuk, valued at $650 million. According to a statement on Tadawul, the total number of sukuk issued stands at 3,250, based on a minimum denomination and total issue size at a par value of $200,000 each. The sukuk offers a return of 6.50 percent and features perpetual maturity. 

Saudi Awwal Bank ended the session at SR34.40, up 1.31 percent. 

Bank Albilad has announced the commencement of its offering for a USD-denominated Additional Tier 1 Capital Sukuk. According to a bourse filing, the final amount and terms of the sukuk will be determined at a later stage, subject to prevailing market conditions. The offering period runs from May 15 to May 16. 

The minimum subscription is set at $200,000, with additional increments of $1,000, based on a par value of $200,000. The bank has appointed HSBC Bank plc, Albilad Capital, Goldman Sachs International, and Emirates NBD Bank PJSC as joint lead managers for the issuance. 

Bank Albilad ended the session at SR27.10, up 0.19 percent. 

Emaar, The Economic City has announced its interim financial results for the first three months of 2025. According to a Tadawul statement, the company reported a net loss of SR123 million in the period ending March 31, down 65 percent compared to the corresponding quarter a year earlier. 

This decrease in net loss is primarily attributed to an increase in revenues, a decrease in operational expenses, and reversal of ECL provision following a reassessment compared to the recorded provision in the corresponding quarter. 

Emaar, The Economic City ended the session at SR13.50, down 1.02 percent. 

Zamil Industrial Investment Co. reported a net profit of SR21.8 million for the first quarter of 2025, marking a 301 percent increase compared to the same period last year, according to a bourse filing.

The sharp rise in earnings was driven by higher sales across all business segments, along with increased operating income in the air conditioning, construction, and insulation divisions. The company also benefited from improved contributions from associates and joint ventures, as well as reduced financial charges. 


Saudi Arabia forges ahead in AI and tech through US partnerships

Updated 15 May 2025
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Saudi Arabia forges ahead in AI and tech through US partnerships

JEDDAH: Saudi Arabia is advancing its artificial intelligence, cybersecurity, and cloud computing capabilities through agreements signed with leading US tech firms during an investment forum in Riyadh.

Among the deals signed during the event, six agreements were inked by entities from the Kingdom with US companies, reflecting the deepening strategic and technological cooperation between the two countries.

The forum commenced on May 13 at the King Abdulaziz International Conference Center in the Saudi capital, with the participation of high-ranking officials from both countries. 

It coincided with the visit of US President Donald Trump, during which the Kingdom announced the signing of agreements with the North American country valued at over $300 billion.

These agreements mark a significant step forward in Saudi Arabia’s push to build a diversified, knowledge-based economy through strategic international partnerships, according to the Saudi News Agency.

The Saudi Data and Artificial Intelligence Authority, known as SDAIA, inked four memorandums of understanding with US technology firms PureStorage, DataDirect Network, Wika.io, and Palo Alto Networks during the event.

The agreements aim to enhance the Kingdom’s data and AI infrastructure, drive innovation in emerging technologies, and strengthen cooperation in cybersecurity and technical fields, SPA reported

In a separate move, the Saudi Digital Government Authority signed an MoU with the leading US multinational technology company Oracle to expand collaboration in cloud computing, AI, and digital services.

“The partnership is expected to strengthen the Kingdom’s leadership in cloud computing and digital transformation, enhance digital awareness among government employees and the wider community, and improve the efficiency of government services provided to citizens and residents,” the authority said in a statement.

The release added that the deal represents a model of constructive collaboration and an extension of national efforts aimed at promoting digital innovation, supporting the economy, and achieving institutional excellence through the development of the digital government ecosystem.

The signing ceremony took place at the authority’s headquarters in Riyadh and was attended by Ahmed Al-Suwaiyan, governor of DGA, and Cormac Watters, executive vice president and general manager at Oracle EMEA applications.

The agreement was signed by DGA Vice Gov. Abdullah Al-Faifi and Oracle Country Leader Reham Al-Musa.

The National Center for Privatization signed a memorandum of cooperation with the Association for the Improvement of American Infrastructure to strengthen professional competencies in privatization and public-private partnerships.

Signed on the sidelines of the forum, the agreement “reflects the NCP’s efforts to expand collaboration with the US private sector and develop training programs for Saudi professionals,” SPA report noted.

Under the deal, NCP and AIAI will work together on joint events, expert exchanges, and specialized sessions aimed at promoting institutional knowledge and global best practices in the Kingdom’s privatization ecosystem.


Saudi Arabia aiming to foster innovation and global collaboration, says economy minister 

Updated 15 May 2025
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Saudi Arabia aiming to foster innovation and global collaboration, says economy minister 

RIYADH: Saudi Arabia aims to foster a dynamic private sector, create jobs for its citizens, and attract international talent as part of its Vision 2030 strategy, according to a top official. 

Speaking during an interview with Fox News on the sidelines of the Saudi-US Investment Forum, Economy and Planning Minister Faisal Al-Ibrahim said the Kingdom has embarked on a transformative path to unlock its potential and shift its growth narrative beyond oil. 

The forum was held on the occasion of US President Donald Trump’s visit to Saudi Arabia, during which he was accompanied by a delegation of leading business figures. 

Al-Ibrahim said: “We want a private sector that’s dynamic. We’re a young population, but in about 20, 25, 30 years, we’ll start the aging process. What we should look like at that stage is a government and a private sector and a third sector, and academia that is leveraging fully generative AI and other technological tools toward productivity.”  

He added: “But also that has created jobs for a lot of Saudis, and has been able to, in the process, attract a lot of talent to come to Saudi to make Saudi Arabia their home.” 

The minister emphasized that diversification has already begun to yield results, with sectors such as tourism, culture, and technology,  as well as sports and artificial intelligence, contributing significantly to gross domestic product. 

“We would love to be competitive in a large and vibrant consumer market, such as that in the US,” the minister said, highlighting the Kingdom’s increasing connections with global markets, especially American capital markets. 

Al-Ibrahim noted that the non-oil gross domestic product has surpassed 50 percent for the first time, but cautioned against complacency. 

“We’re not over-celebrating that, but we’re acknowledging this as a milestone. What we want to see is more non-oil exports growing. More non-oil exports of our manufacturing, GDP,” Al-Ibrahim said. 

The minister also emphasized the importance of service sector quality, adding: “We want to see user experience in the services side, especially on the tourism side, second to none. Still have a lot of work to do.” 

He noted that both Crown Prince Mohammed bin Salman and President Donald Trump have spoken of “peace and prosperity” as tools to address global challenges, reinforcing the Kingdom’s alignment with international efforts toward stability. 

“We’ve seen what dialogue has led to in terms of the US and UK deal, US and China deal, and what Saudi has led to also through dialogue in the region,” the minister added. 

On regional developments, he commented on the US decision to lift sanctions on Syria and its potential impact. 

“Something as strong and meaningful and material as lifting sanctions could help a country such as Syria to invest more capital in building the institutions they need to be a more stable country, but also bring more stability to the region and be a force for good,” Al-Ibrahim said.

Describing the relationship between the crown prince and President Trump, the minister added: “I see common values between both leaders, regardless of age and background, and I think that’s one of the things that really brings the mutual respect into the public eye.” 

Addressing skepticism about the Kingdom’s evolution, the minister concluded: “Saudi Arabia is a long-term reliable partner, if you ask anyone who has dealt with the Kingdom, government, people, anyone who has visited here ... Saudi Arabia has always been and always will be a force for good, for innovation.”