Saudi Arabia’s gross domestic product is expected to grow 3.7 per cent in 2025, driven by a rise in the kingdom’s non-oil activities, according to an analysis, reports Arab News.
In its latest report, Mastercard Economics Institute said Saudi Arabia’s rapid expansion of its GDP will outperform the projected global average, which is estimated at 3.2pc in 2025.
The kingdom’s robust growth in the non-oil sector signifies the nation’s steadily progressing economic diversification journey aimed at reducing reliance on crude revenues.
According to the analysis, Saudi Arabia’s projected economic growth in 2025 is higher than that of major players, including the US, Germany, and Japan, as well as the UK, France, and Australia.
“With robust non-oil economic activity and continued investments aligned with Vision 2030, Saudi Arabia is set to maintain its strong growth trajectory, outpacing global markets,” said Khatija Haque, chief economist of Mastercard for the Eastern Europe, Middle East and Africa region.
She added: “As we move into 2025, a year shaped by evolving fiscal and monetary policies, the kingdom’s diversification efforts and supportive economic reforms will solidify its position as a key driver of regional economic expansion. These structural shifts will continue to redefine economic landscapes, charting new pathways for sustainable growth.”
In November, a report released by the International Monetary Fund projected that Saudi Arabia’s economy is expected to remain resilient, with the kingdom’s GDP set to expand by 1.5pc and 4.6pc in 2024 and 2025, respectively.
In September, another study released by credit-rating agency S&P Global said that Saudi Arabia’s GDP will expand by 1.4pc in 2024 before accelerating to 5.3pc in 2025.
The Mastercard analysis revealed economic diversification efforts in the kingdom will continue in 2025 as the government leverages strong balance sheets to finance investment in infrastructure.
The report added that private sector investments should also benefit from lower interest rates, supporting employment and domestic consumption.
Regionally, the tourism sector is expected to remain a bright spot for the economies in the GCC region.
“The GCC’s strong push to develop its tourism offerings has positioned it as one of the fastest-growing destinations in the world. In addition, the strength of the region’s US dollar-pegged currencies is fueling the demand for outbound travel,” said Mastercard Economics Institute.
The institute further projected that Saudi Arabia’s inflation is expected to stay at a healthy level of 2pc in 2025, while consumer spending in the kingdom is projected to expand by 4.5pc.
Earlier this month, a report released by Saudi Arabia’s General Authority for Statistics revealed that the kingdom’s annual inflation rate reached 2pc in November compared to the same month in 2023.
In October, the World Bank projected that Saudi Arabia’s inflation level is expected to stay at 2.1pc in 2024 and 2.3pc in 2025, lower than the GCC average.
Globally, Mastercard Economics Institute projected that the average inflation level will remain at 3.2pc next year.
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