Non-oil economic activity already accounts for 50% of Saudi GDP
Non-oil economic activity in Saudi Arabia has reached a milestone of 50% of the country's real gross domestic product (GDP) by 2023, as reported by the Saudi Press Agency (SPA). This is the highest level on record, according to the Ministry of Economy and Planning.
The Kingdom's non-oil economy was valued at 1.7 trillion Saudi rials (approximately 453 billion US dollars) at constant prices, driven by steady growth in investment, consumer spending and exports.
On the other hand, private sector investment has increased over the past two years, with a growth rate of 57%, reaching a record 959 billion Saudi Rials (254 billion US dollars) in 2023. Non-oil industries include the arts and entertainment sectors, which have experienced 106% growth between 2021 and 2022.
Real services exports, driven mainly by tourist spending, have also soared in the last two years, reaching a growth rate of 319%.
This remarkable increase in non-oil activity within the Saudi economy is in line with the Kingdom's goal of diversifying its economy and decreasing its dependence on oil. This is, in fact, one of the goals of Vision 2030, a strategy designed by Riyadh to diversify its economy and develop sectors such as health, education, infrastructure, recreation and tourism.
Sport, tourism and green energy
Saudi Arabia has been committed to sport for years, investing in its football teams, but also hosting international competitions in golf, tennis and F1. Riyadh is also seeking to promote its tourism abroad through historical sites such as Al-Ula and Diriyah, a UNESCO World Heritage Site.
Another sector where the Kingdom is investing in order to achieve a sustainable economy is renewable energy. During the third edition of the Saudi Green Initiative Forum at COP28 in the UAE, Saudi officials revealed that the nation had succeeded in connecting 2,100 MW of renewables to the grid by 2023, bringing the total installed renewable energy capacity to 2,800 MW (2.8 GW), up 300% from 700MW the previous year.
Last year, Riyadh also announced plans to build two solar PV installations - Al Shuaibah PV 1 and Al Shuaibah PV 2 - in which it will invest more than $2.37bn.