BrazilSaudi Arabia joins $1 trillion club and is now 19th economy worldwide
The economy of Saudi Arabia has seen its GDP break through the magical $1 trillion barrier for the first time in its 91-year history. The Kingdom becomes only the 19th national economy in the world to pass the landmark figure.
First announced by the Saudi Arabian monarchy in 2016, Vision 2030 aims to diversify the country’s economy and reduce its dependence on oil by the end of the present decade. The plan includes a wide range of economic and social reforms, including investments in non-oil sectors, privatisation of state assets, and the development of infrastructure, healthcare, and education.
Mohammed bin Salman Al Saud has made the targets a key priority for the Gulf state, since being placed in the offices of Crown Prince and Prime Minister of Saudi Arabia by his father King Salman in 2017.
Determined to present the country as a modern hub of business and innovation to investors, this has seen his administration push forward plans to transform and modernise the economy, government, and society as a whole.
The roadmap has so far been a successful one, with statistics from the Saudi General Authority for Statistics showing that the economy has now surpassed the $1 trillion mark, as the economy grew by 8.7% over the past twelve months, while the unemployment rate among citizens also fell sharply.
In comparison: in 2016, when Vision 2030 launched, Saudi gross domestic product (GDP) stood at $645 billion.
The kingdom’s GDP at constant prices has reached 4.2 trillion Saudi riyals ($1.1 trillion), buoyed by non-oil sector growth. The non-oil sector contributed about 2.3 trillion riyals to the GDP, accounting for 61% of the total, while the hydrocarbon sector added 1.61 trillion riyals, or 39%.
According to the latest data from the Organisation for Economic Co-operation and Development (OECD), Saudi Arabia’s most recent by 8.7% growth was the highest annual growth rate among world’s 20 biggest economies.
Saudi Arabia can now call itself the world’s 19th trillion-dollar economy – on par with the Netherlands, and just behind Turkey. The United States remains by a distance the globe’s largest economy, with China in second place, the two superpowers however are miles ahead of Germany, Japan, and India.
The Saudi General Authority for Statistics forecasts that domestic GDP growth will remain strong the coming two years, with $1.25 trillion a “realistic scenario” for the end of 2025.
Worldwide, the size of all national economies is expected to reach $105 trillion by the end of 2023, or $5 trillion higher than the year before, according to the latest 2023 World Economic Outlook by the International Monetary Fund.
Notably, in this year’s analysis, the IMF researchers excluded projections for three Middle East countries: Afghanistan, Lebanon, and Syria.
Vision 2030
GDP growth is just one of the many key economic pillars outlined in Vision 2030. Others include increasing the private sector share of the GDP, growing the share of non-oil revenue as part of a diversification agenda, lowering the unemployment rate to 7%, and increasing the participation of women in the workforce to 30%.
