Saudi non-oil sector to maintain growth in 2015
12 Jan 2015
(MENAFN) According to a new report by Jadwa, Saudi Arabia’s non-oil sector is forecasted to maintain its growth in 2015, despite an expected decline in the Kingdom’s overall GDP growth and a contraction in the oil sector due to the plunge in oil prices globally, Saudi Gazette reported.
The report said the Saudi non-oil private sector GDP growth in 2015 is forecasted at 5.3 percent compared with an average of 7.2 percent for the last five years, with the sector expected to continue benefiting from government spending, corporate lending, and solid domestic consumption.
Jadwa said that according to the new budget, total government spending will be equivalent to 36.3 percent of GDP compared with an average of 31.9 percent in the last 10 years, despite the government cutting its budgeted investment spending by 35 percent for 2015 for the first time since 2002 and the current budgeted investment spending is still 36 percent higher than its level five years ago.
In 2014, the Saudi economy expanded by 3.6 percent, accelerating from 2.7 percent in 2013, while an increase by 0.8 percent in oil production was registered after and a new refinery came on line during 2014 while the non-oil sector maintained a growth of over 5 percent for the eleventh consecutive year in 2014.
Meanwhile, the non-oil manufacturing growth is forecasted to slightly slow in 2015, but to remain strong following growth of 6.3 percent and 6.5 percent in 2013 and 2014 respectively, while the oil sector, the largest sector of the economy, accounting for around 43 percent =at the end of 2014, is forecasted to contract slightly owing to a decline in oil production.