Saudi Arabia’s non-oil revenue hit $453bn in 2023 — highest level ever

The Kingdom of Saudi Arabia says it recorded $453 billion in revenue from its non-oil sector — the highest level ever.

The amount, according to Saudi Arabia’s ministry of economy and planning, represents 50 percent of the country’s gross domestic product (GDP) in 2023.

The Arab nation’s non-oil economy, valued at 1.7 trillion Saudi Riyals (approximately $453 billion), was driven by growth in exports, investment, and consumer spending, said a report by Saudi Press Agency.

The Kingdom’s private-sector investments expanded by 57 percent, reaching a record high of 959 billion Saudi Riyals ($254 billion) in 2023, while arts and entertainment, and real service exports grew in triple-digits to the tune of 106 percent and 319 percent, respectively.

This reflects the country’s transformation into a global destination for tourism and entertainment, the ministry of economy said.

The agency also said Saudi’s food sector recorded a 77 percent growth, adding that transport and storage services grew by 29 percent.

While health and education recorded a growth of 10.8 percent, trade, restaurants, and hotels grew by 7 percent as well as transport and communications at 3.7 percent.

For many years, Saudi Arabia has been seen as the Organisation of Petroleum Exporting Countries (OPEC’s) de facto leader and a swing producer.

A swing producer can increase or decrease commodity supply at minimal additional internal cost and influence market prices.

In June 2023, the Arab nation decided to reduce its oil output by one million barrels per day (bpd) — nearly half of the OPEC’s 2.2 million bpd in pledged cuts — bearing the brunt of OPEC+ production cuts over the past few years.

The growth in the non-oil sector is said to align with the country’s plan to diversify its economy, following the unveiling of the ‘Saudi Vision 2030’ by Mohammed bin Salman, Saudi Arabia’s crown prince, in 2016.

The main goal of the vision is to diversify Saudi Arabia’s economy and create dynamic job opportunities for its citizens through privatisation of state-owned assets, including partial initial public offering (IPO) of Saudi Aramco; unlocking underdeveloped industries such as renewable energy, manufacturing and tourism and modernising the curriculum and standards of Saudi educational institutions from childhood to higher learning.

In the economic plan, Saudi Arabia also aims to develop 60 gigawatts (GW) of renewable energy capacity by 2030, multiples higher than the country’s current installed capacity of only 2.8 GW.

In 2023, Saudi Aramco, the country’s oil company, said it was considering selling a 2.5 percent stake worth $50 billion.

The energy firm is said to be the world’s biggest oil company, with a market value of $2.25 trillion.

In 2019, the company executed the largest IPO in history, raising $25.6 billion, and later sold additional shares to increase the total value to $29.4 billion.

On December 23, 2023, Saudi Arabia announced a 300 percent increase in installed renewables capacity.