Saudi Arabia: GDP growth improves in Q1
May 1, 2022
A flash estimate showed that the economy grew 9.6% on an annual basis in the first quarter of 2022, after expanding 6.7% in the fourth quarter of 2021.
The improved performance was due to a stronger expansion of the oil sector, which grew 20.4% in Q1 2022 compared to 10.9% in Q4 2021. Growth in the non-oil private sector, meanwhile, slowed to 3.7% in Q1 from 4.7% in Q4 last year, while non-oil government activity growth was stable at the prior quarter’s 2.4% in Q1.
Moving forward, the non-oil private sector should continue to benefit from looser Covid-19 containment measures and the resumption of international travel. Turning to the oil sector, the ongoing easing of OPEC+ production curtailments should continue to support the energy economy and oil output. This, coupled with nearly decade high prices for oil—largely stemming from the ongoing war in Ukraine—bodes well for public finances.