Unprecedented investments into tourism, arts and leisure pay off for Saudi Arabia
Dubai: The Saudi Arabian economy has just reached a landmark – 50 per cent of its real GDP in 2023 came from non-oil sector activities. This marks a massive win as the Kingdom keeps broad-basing its economy and lessen its reliance on oil proceeds for development.
The Saudi non-oil economy reached SR 1.7 trillion ‘driven by continued growth in investment, consumption, and exports’. And this represents 50 per cent of real GDP, making it the ‘highest historical level ever reached’. This based on the Saudi Ministry of Economy and Planning’s analysis of data issued by General Authority for Statistics.
The non-oil GDP percentage was achieved due to an ‘unprecedented performance in real non-government investment’ over the last two years. This represents a growth rate of 57 per cent, bringing the value of non-government investments to its highest ever total of SR959 billion in 2023.
Which sectors pulled in investment led growth
The arts and entertainment sector was driving some of the heavy growth, with 106 per cent during 2021-22, while sectors such as food and accommodation gained 77 per cent, and transportation and communications at 29 per cent.
The growth in non-oil activities during 2023 was ‘exceptional in the diversity of contribution and growth momentum’. “Social services – such as health, education, and entertainment – recorded a growth of 10.8 per cent, followed by transportation and communications at 7.3 per cent, and trade, restaurants, and hotels at 7 per cent,” the statement said.
In addition, service-based revenues, represented by the spending done by tourists, recorded ‘historic growth’ rates during the last two years, at 319 per cent. This reflects a ‘clear impact of the Kingdom’s transformation into a global destination for tourism, and entertainment, and advances in economic diversification as growth engines,” the statement added.
“This increase reflects the goals of Saudi Vision 2030, which is to achieve a prosperous economy by diversifying growth engines, and the Kingdom’s success in implementing the relevant programs and major projects, by opening new sectors that contribute to reaching sustainable and robust economic growth.”