Saudi GDP Grew in 3Q, but Non-Oil Growth Slows

Saudi Arabia’s economy grew in the third quarter of 2018 at its fastest rate since early 2016, according to reports, but non-oil growth slowed to 2.1 percent from 2.4 percent.

The economic expansion came on the back of the oil sector, Reuters reports, with gross domestic product growth up 2.5 percent from a year earlier.

But the slowing in non-oil growth, which is key for job creation and the Kingdom’s goals of a more diverse economy, is concerning for Saudi officials. As Reuters reports, GDP growth picked up “largely because of higher oil output. The oil sector expanded 3.7 percent from a year ago in the third quarter, after 1.3 percent in the second.”

Saudi Arabia recently announced plans to increase state spending by more than seven percent next year in an effort to spur economic growth, which has been hurt by low oil prices, according to a 2019 budget released by the finance ministry.