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Saudi Arabia’s Economy Joins The Trillion Dollar Club for The First Time
Saudi Arabia_s Economy_ A New Entrant in the Trillion-Dollar Club

Saudi Arabia’s economy has joined the trillion-dollar club with its GDP exceeding $1 Trillion for the first time. The Saudi Economy was also the fastest-growing economy in the G20 in 2022 according to the IMF with a Private Sector Contribution of $440 Million.

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The Trillion-Dollar Achievement

This monumental achievement was announced by the Federation of Saudi Chambers in a report issued on Saudi Arabia’s 93rd National Day. The accomplishment was reached well in advance of the projected target date of 2025, marking a new chapter in the Kingdom’s economic journey.

The International Monetary Fund (IMF) noted that the Saudi economy was the fastest-growing among the Group of Twenty (G20) member states in 2022. 

The remarkable growth rate of 8.7% was primarily due to the Kingdom’s robust production capabilities, which led to an increase in the self-sufficiency rate of the Saudi economy to 81.2%. The investment rate also saw a substantial rise, reaching 27.3%.

Confidence in the Saudi Economy

The impressive economic performance has resulted in increased confidence in the national economy and the Saudi Riyal. This is evidenced by the increase in the ratio of local currency deposits to total savings deposits from 66.5% in 2021 to 67.7% in 2022.

Role of the Private Sector

The private sector has played a significant role in Saudi Arabia’s economic success, contributing approximately $440 billion to the GDP, which accounts for around 41% of the total GDP. 

The report issued by the Federation of Saudi Chambers highlighted the private sector’s vital role as an effective partner in the comprehensive development process and in achieving the goals of the ambitious Vision 2030.

The number of workers in the private sector saw a considerable increase from 8.084 million in 2021 to 9.422 million in 2022, marking a growth rate of 16.6%.  

As part of the localization effort of the labor force, the number of Saudis employed in the private sector also saw a significant upswing, increasing from 1.910 million in 2021 to 2.195 million in 2022. This marked a growth rate of 14.9%, which was reflected in an increase in the percentage of Saudi workers in the private sector to 58.2%.

Diversification of the Economy

Saudi Arabia’s economic policies have been successful in diversifying the economic base and promoting Saudi exports to global markets. According to the Federation of Saudi Chambers report, exports of goods and services increased by a significant 54.4%. 

The export capacity of the Saudi economy also saw a substantial rise from 33% to 39.3% of the GDP. The value of exports of goods and services rose to 171.9% of the value of imports of goods and services in 2022, up from 134.5% in the previous year.

Non-Oil Exports

The value of non-oil exports reached a staggering SAR 315.7 billion, marking a growth rate of 13.7%. These non-oil exports accounted for 20.5% of commodity exports and reached 178 countries worldwide, further proving the strength and diversity of the Saudi economy.

Future Outlook

The report issued by the Federation of Saudi Chambers projected a continued strong performance by the Saudi economy and the private sector. The prediction is based on various economic indicators, government support packages, and large-scale projects being implemented across the Kingdom.

Saudi Arabia’s inclusion in the Trillion Dollar Club is a testament to its robust economic policies and successful efforts in diversifying its economy. As the Kingdom continues on its path towards Vision 2030, it stands as a model for economic growth and diversification in the region and beyond.

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