The Kingdom’s PMI rises to 56.9, marking steady growth in non-oil business activity driven by increased demand and Vision 2030 initiatives

In a promising sign for Saudi Arabia’s economy, the Kingdom’s Purchasing Managers’ Index (PMI) for non-oil business activity reached 56.9 in October, a six-month high. This latest figure, reported by the Riyad Bank and compiled by S&P Global, indicates growth across the non-oil sector, boosted by rising sales and economic conditions that align with Saudi Arabia’s Vision 2030 goals to reduce its reliance on oil.

This rise reflects a consistent expansion in Saudi Arabia’s non-oil private sector. As per Naif Al-Ghaith, Riyad Bank’s chief economist, growth has been steady since 2020, driven by strong client demand, successful marketing, and infrastructure developments supporting the Kingdom’s ambitious diversification strategy. The report shows increased confidence, with over 40% of surveyed companies noting a surge in demand from domestic clients, reflecting high market confidence.

Al-Ghaith emphasised that ongoing projects under Vision 2030 continue to bolster economic resilience, with the non-oil sector’s contribution expected to exceed 52% of the GDP. While employment growth remains strong, the overall job creation rate has eased, primarily due to a slowdown in the construction sector. Survey participants remain optimistic about future growth, with many expanding their purchasing and labour capacity to meet rising workloads.

Saudi Arabia’s robust PMI growth in the non-oil sector highlights the effectiveness of Vision 2030 initiatives in fostering economic resilience and diversification. Industry experts suggest that expanding sectors such as tourism, finance, and logistics are now major contributors to this growth, offsetting challenges faced by traditional sectors like construction. As businesses adapt to the rising demand and enhanced infrastructure, the Kingdom is well-positioned to strengthen its non-oil economy, creating a more balanced and sustainable growth trajectory moving forward.

This sustained growth trend, alongside the Kingdom’s infrastructure investments, positions Saudi Arabia as a leading non-oil economy in the region, with continued progress anticipated for 2024.