Riyadh, Saudi Arabia — Saudi Arabia’s first quarter real Gross Domestic Product (GDP) grew by 3.4 percent year-on-year, according to the latest report from the General Authority for Statistics (GASTAT), primarily driven by a 4.9 percent surge in non-oil activities and a 3.2 percent rise in government activities.
GASTAT’s data show that non-oil activities were the main engine of expansion, contributing 2.8 percentage points to overall GDP growth, while government activities and net product taxes added 0.5 and 0.2 percentage points, respectively.
Sectors such as wholesale and retail trade, restaurants, and hotels led the way, recording an impressive 8.4 percent annual growth, reflecting a rebound in consumer demand and tourism-related activity. The transport, storage, and communication sector also saw a notable 6 percent increase, and finance, insurance, and business services grew by 5.5 percent year-on-year.
Oil activities, meanwhile, contracted by just 0.5 percent—less than the 1.4 percent decline initially forecast in flash estimates. Analysts attribute the smaller contraction to a combination of higher-than-expected oil output and resilient private sector performance.
Despite the positive momentum, Saudi Arabia faces fiscal challenges as oil prices remain below the level needed to balance the budget. The International Monetary Fund estimates the Kingdom requires oil prices above $90 per barrel to break even, while current prices hover around $60.
On a quarterly basis, seasonally adjusted real GDP rose by 1.1 percent compared to Q4 2024, signaling continued economic momentum into the year.
