Palm trees and buildings in Saudi Arabia

Saudi Arabia Economic Forecast

Saudi Arabia Economic Outlook

In the third quarter, the economy contracted the most since the height of the Covid-19 pandemic in Q3 2020. Oil production was 17.4% less in the quarter than in the same period a year ago as a result of cuts to crude output made with OPEC and those made unilaterally. In addition, non-oil firms increased their production at the slowest year-on-year pace since Q4 2020. Turning to the fourth quarter, the economy is highly likely to contract again. Crude production fell around 17% in October, and similarly large falls are likely in November and December. More positively, in October, non-oil business activity continued to rise at one of the speediest paces in the last decade. All eyes are now on the next OPEC+ meeting, which was delayed to 30 November from 26 November due to Saudi Arabia reportedly pushing for other members to join it in cutting oil production further.

Saudi Arabia Inflation

Inflation eased to 1.6% in October, down from September’s 1.7% and the lowest since February 2022. Next year, inflation is set to decline slightly on average compared to this year on a tougher base effect and past interest rate hikes. Changes to government subsidies and rises in food prices as a result of El Niño are key upside risks.

This chart displays Economic Growth (GDP, annual variation in %) for Saudi Arabia from 2013 to 2022.

Saudi Arabia Economic Data

2018 2019 2020 2021 2022
Population (million) 30.2 30.1 31.6 30.8 32.2
GDP (USD bn) 846 838 734 874 1,107
GDP per capita (USD) 28,032 27,889 23,256 28,390 34,410
GDP (SAR bn) 3,175 3,145 2,754 3,278 4,157
Economic Growth (Nominal GDP, ann. var. %) 18.4 -0.9 -12.4 19.1 26.8
Economic Growth (GDP, ann. var. %) 2.8 0.8 -4.3 3.9 8.7
Economic Growth (GDP non-Oil, ann. var. %) -0.9 3.5 -3.0 5.7 4.8
Economic Growth (GDP Oil, ann. var. %) 2.3 -3.3 -6.7 0.2 15.4
Domestic Demand (ann. var. %) 0.4 6.9 -6.1 6.5 5.1
Private Consumption (ann. var. %) 2.5 6.5 -8.1 9.4 4.8
Government Consumption (ann. var. %) 9.3 -3.0 3.3 0.8 6.7
Fixed Investment (ann. var. %) 2.4 4.8 -10.4 10.1 24.1
Exports (G&S, ann. var. %) 7.2 -5.0 -10.6 1.0 18.7
Imports (G&S, ann. var. %) 2.6 9.6 -19.7 8.3 12.0
Industry (ann. var. %) 0.4 -1.9 -5.9 1.8 12.8
Oil Production (mn barrels per day, aop) 10.31 9.77 9.19 9.08 10.53
Unemployment (% of active population, aop) 6.0 5.6 7.7 6.6 5.6
General Government Revenues (SAR bn) 906 927 782 965 1,268
General Government Expenditures (SAR bn) 1,079 1,059 1,076 1,039 1,164
Fiscal Balance (% of GDP) -5.5 -4.2 -10.7 -2.2 2.5
Public Debt (% of GDP) 17.6 21.6 31.0 28.8 23.8
Money (ann. var. of M3 %) 2.7 7.1 8.3 7.4 8.1
Inflation (CPI, ann. var. %, eop) 1.9 -0.2 5.3 1.2 3.3
Inflation (CPI, ann. var. %, aop) 2.5 -2.1 3.4 3.1 2.5
Inflation (WPI, ann. var. %, eop) 15.7 3.7 5.2 13.3 3.0
SAMA Repo Rate (%, eop) 3.00 2.25 1.00 1.00 5.00
SAMA Reverse Repo Rate (%, eop) 2.50 1.75 0.50 0.50 4.50
3-Month Interbank Rate (%, eop) 2.90 2.24 0.82 0.87 5.28
Exchange Rate (SAR per USD, eop) 3.75 3.75 3.75 3.75 3.76
Current Account Balance (USD bn) 72.0 38.2 -22.8 44.3 153.3
Current Account Balance (% of GDP) 8.5 4.6 -3.1 5.1 13.8
Merchandise Trade Balance (USD bn) 168.7 121.3 47.9 136.4 235.0
Merchandise Exports (USD bn) 294 262 174 276 411
Merchandise Imports (USD bn) 126 140 126 140 176
Merchandise Exports (ann. var. %) 32.7 -11.1 -33.6 58.9 48.7
Merchandise Imports (ann. var. %) 1.8 11.7 -10.3 11.0 25.8
OPEC Oil Basket Price (USD per Barrel) 69.8 64.0 41.5 69.9 100.1
Foreign Direct Investment (USD bn) 4.2 4.6 5.4 19.3 7.9
International Reserves (USD bn) 497 500 453 455 459
International Reserves (months of imports) 47.4 42.7 43.2 39.1 31.4

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