Saudi Arabia: Economic outline
Saudi Arabia is the largest economy in the Middle East and the richest Arab country. The policy of large-scale public works undertaken by the authorities, as well as foreign direct investment and the soundness of the banking and financial system, have enabled the country to become the number one regional economy and one of the largest in the world. However, the economy of Saudi Arabia is almost entirely based on oil, with GDP growth being closely linked to real oil growth. After a recession in 223 (-0.8% of GDP) due to oil production cuts and lower oil prices, the kingdom returned to growth in 2024, with real GDP increasing 1.3% compared to the previous year, according to preliminary government data. Non-oil growth significantly outpaced overall GDP, rising by 4.3%, while oil activities declined by 4.5% and government activities grew by 2.6%. According to the IMF, overall GDP growth is projected to accelerate to 4.7% in 2025, assuming the 1 mbpd voluntary oil production cuts are gradually phased out from October 2024 to September 2025, with an average growth of 3.7% per year thereafter.
Concerning public finances, the 2024 budget deficit was officially estimated at 2.8% of GDP, up from 2% in 2023, as spending growth outpaced revenue growth, which was constrained by lower oil production in line with Opec+ commitments. In the 2025 state budget, authorities forecast a fiscal deficit of SAR 101 billion (USD 26.88 billion), as the kingdom continues spending on large-scale gigaprojects to diversify its economy away from oil. The deficit aligns with a preliminary government projection from September, representing about 2.3% of GDP. Fitch projects government debt to rise to 35.3% of GDP by the end of 2026, up from 29.8% at the end of 2024. Government deposits at the Saudi Central Bank (SAMA), including the current account and fiscal reserve, were estimated at 10.3% of GDP at the end of 2024. Contingent liabilities are rising as government-related entities (GRE), particularly the Public Investment Fund (PIF), increase borrowing, but remain small relative to GRE assets (PIF debt was 4.4% of its assets at the end of Q3 2024). Saudi Arabia's inflation in 2024 increased to 1.7% compared to the previous year, according to data from the General Authority for Statistics (GASTAT). The cost-of-living index stood at 111.30 points in 2024, based on the 2018 reference year, up from 109.45 points in 2023.
The standard of living in Saudi Arabia is one of the highest in the Middle East, with a GDP per capita (PPP) of USD 65,885 (IMF, 2024). According to the latest data available from the Saudi General Authority for Statistics, unemployment among Saudis stood at 7.8% as of the third quarter of 2024, while the overall unemployment rate stood at 3.7%. The unemployment rate hit historic lows, with women’s labour force participation remaining well above the 30% target for 2030.
Main Indicators | 2023 (E) | 2024 (E) | 2025 (E) | 2026 (E) | 2027 (E) |
GDP (billions USD) | 1,067.58 | 1,100.71 | 1,136.58 | 1,199.16 | 1,262.33 |
GDP (Constant Prices, Annual % Change) | -0.8 | 1.5 | 3.3 | 4.1 | 3.6 |
GDP per Capita (USD) | 32,530 | 32,881 | 33,287 | 34,431 | 35,534 |
General Government Gross Debt (in % of GDP) | 26.2 | 28.3 | 30.6 | 31.9 | 33.1 |
Inflation Rate (%) | 2.3 | 1.7 | 1.9 | 2.0 | 2.0 |
Unemployment Rate (% of the Labour Force) | 3.8 | 0.0 | 0.0 | 0.0 | 0.0 |
Current Account (billions USD) | 34.07 | 4.25 | -20.74 | -22.56 | -28.84 |
Current Account (in % of GDP) | 3.2 | 0.4 | -1.8 | -1.9 | -2.3 |
Source: IMF – World Economic Outlook Database, 2016
Note: (e) Estimated Data
Monetary Indicators | 2016 | 2017 | 2018 | 2019 | 2020 |
Saudi Riyal (SAR) - Average Annual Exchange Rate For 1 GHS | 0.94 | 0.86 | 0.82 | 0.73 | 0.67 |
Source: World Bank, 2015
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Latest Update: February 2025