Saudi Arabia’s economic diversification to drive robust growth in 2025.
Saudi Arabia’s economic diversification efforts and the robust expansion of the non-oil sector, in line with its Vision 2030, are set to drive significant economic growth in 2025, according to a recent analysis.
First Abu Dhabi Bank, in its latest report, predicts that Saudi Arabia’s non-energy gross domestic product will grow by 4.4 percent in 2025, up from 3.5 percent in the previous year. This forecast aligns with a similar projection from PwC, which also expects the non-oil economy to grow by 4.4 percent this year.
In January, the International Monetary Fund projected Saudi Arabia’s overall economy would expand by 3.3 percent in 2025, with further growth expected at 4.1 percent in 2026.
FAB’s analysis is also consistent with a recent report from Riyad Bank, which forecasts a 4.8 percent growth in Saudi Arabia’s economy in 2025.
“Our constructive outlook on the GCC macroeconomic landscape in 2025 was bolstered and corroborated by Moody’s upgrade of Saudi Arabia’s sovereign credit rating. Saudi Arabia’s diversification momentum will be sustained going forward,” said FAB.
In November 2024, the global credit rating agency upgraded Saudi Arabia’s credit rating and that of related government entities to Aa3 from A1, maintaining a stable outlook. The GDP growth for the entire Gulf Cooperation Council region is expected to double from 2.1 percent in 2024 to 4.2 percent in 2025, driven by the continued growth of business activities in the non-energy sectors across these countries.
FAB projected that the UAE’s economy will expand by 5.6 percent in 2025, up from 4.5 percent in the previous year, surpassing the IMF’s global growth forecast of 3.2 percent. This growth will be fueled by strategic investments, diversification, and strong expansion in the non-oil sector.
Referring to IMF projections, the report noted that Egypt’s economy is expected to grow by 4.1 percent in 2025, up from 2.7 percent in 2024.
“The 2025 global economic environment presents unique challenges, but the GCC region continues to stand out as a beacon of resilience and opportunity,” said Michel Longhini, group head of Global Private Banking at FAB.
Source: ARABNEWS
