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Non-oil Sector Leads Saudi Arabia’s GDP Growth in Second Quarter

Non-oil activities achieved a positive growth of 6.1% during the second quarter of 2023. (SPA)
Non-oil activities achieved a positive growth of 6.1% during the second quarter of 2023. (SPA)
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Non-oil Sector Leads Saudi Arabia’s GDP Growth in Second Quarter

Non-oil activities achieved a positive growth of 6.1% during the second quarter of 2023. (SPA)
Non-oil activities achieved a positive growth of 6.1% during the second quarter of 2023. (SPA)

The surge of the non-oil economy in Saudi Arabia at a rate of 6.1 percent, during the second quarter of 2023, led the Kingdom to raise its estimates of GDP growth from 1.1 percent to 1.2 percent.

On July 31, the General Authority for Statistics (GASTAT) issued preliminary estimates, which pointed that the GDP growth reached 1.1 percent in the second quarter of the year.

The GASTAT recent report noted that most economic activities recorded positive growth rates on an annual basis in the second quarter of 2023, with transport, storage and communication activities registering the highest rates of 12.9 percent.

This was supported by the launch of a number of developments and projects, including the official inauguration of Riyadh Air, which will start operating by 2025, according Jadwa Investment.

Wholesale and retail trade, restaurants and hotel activities also grew by 9.8 percent in the second quarter compared to the same period of 2022.

The construction sector also rebounded strongly, growing by 4 percent during the second quarter on an annual basis, in an upward trend, after nearly two years of stagnation that was mainly due to the outbreak of the Covid-19.

On Wednesday, the International Monetary Fund (IMF), in a statement issued by its Executive Board at the conclusion of the 2023 Article IV consultation with Saudi Arabia, expected that the real non-oil GDP in the Kingdom would grow by 4.9 percent during 2023, and 4.4 percent during 2024.

The statement added that the IMF Board “welcomed Saudi Arabia’s ongoing economic transformation, supported by commendable reforms under the Vision 2030 agenda and higher oil prices, which has helped create high growth, record low unemployment, contained inflation, and strong external and fiscal buffers, while reducing reliance on oil.”

The GASTAT report showed that the GDP increased by 1.2 percent in the second quarter on an annual basis, while it decreased by 0.2 percent on a quarterly basis compared to the first quarter of the year.

GASTAT further noted that the Kingdom’s oil activities decreased by 4.3 percent in the three months to the end of June, compared to the same period of the previous year, while it dropped by 1.5 percent from the first quarter of 2023.

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Fire, Smoke Upend Western Canada’s Summer Tourism Season

A helicopter works a forest fire outside of Jasper, Alberta, Canada, on Friday July 26, 2024. (Reuters)
A helicopter works a forest fire outside of Jasper, Alberta, Canada, on Friday July 26, 2024. (Reuters)
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Fire, Smoke Upend Western Canada’s Summer Tourism Season

A helicopter works a forest fire outside of Jasper, Alberta, Canada, on Friday July 26, 2024. (Reuters)
A helicopter works a forest fire outside of Jasper, Alberta, Canada, on Friday July 26, 2024. (Reuters)

Severe wildfire seasons are increasingly hurting western Canada's lucrative tourism industry, with some visitors beginning to avoid the busy late-summer months due to concerns about uncontrolled blazes, smoke-filled skies and road closures.

After a scorching start to July, nearly 600 wildfires are now ablaze across British Columbia and Alberta, including a huge fire that this week devastated the picturesque tourist town of Jasper in the Canadian Rockies.

Dozens of communities, including popular holiday spots in British Columbia's Kootenay region, are under evacuation orders and several highways are closed.

This year's surge in wildfire activity comes after Canada endured its worst-ever year for wildfires in 2023, when more than 15 million hectares (37 million acres) burned, including parts of the city of West Kelowna in the heart of British Columbia's wine region.

Ellen Walker-Matthews, head of the Thompson Okanagan Tourism Association, said the industry was seeing a lot more last-minute travel decisions instead of booking in advance.

"It's a huge blow. July and August are traditionally the busiest months in the region," said Walker-Matthews, adding that while her region has been relatively unscathed by wildfires this summer, some visitors are choosing to avoid interior British Columbia altogether.

The members of the British Columbia Lodging and Campgrounds Association are reporting a 5-15% drop in bookings from a year ago, with the biggest declines coming from the hotter Okanagan and Cariboo regions, said Joss Penny, who heads the association.

"The concern is that this is something we have to live with and we have it every year now," said Penny.

Although wildfires in Canada's forests are natural and common, scientists say drier, hotter conditions fueled by climate change are leading to more volatile and frequent blazes.

'SMOKEY SKIES'

Some events, like the Salmon Arm Roots and Blues Festival, usually held in August, have now been rescheduled to earlier in the summer to avoid what is now seen as peak smoke season. The festival, which was cancelled last year due to nearby wildfires, was this year moved to July to benefit from "less smokey skies."

Wildfires and extreme climatic events are prompting tourists to "change their plans not just temporarily, but permanently," said Elizabeth Halpenny, a tourism researcher and professor at the University of Alberta, noting that seasonal workers in the sector are often the hardest hit as they have few protections during a bad season or amid a cataclysmic fire.

Tourism contributed C$7.2 billion to the British Columbia economy in 2022, and C$9.9 billion to Alberta in 2023, according to the latest government data.

Jasper National Park is one of Canada's premier tourist destinations, with more than 2 million visitors a year flocking to see its pristine mountain landscapes and abundant wildlife, including grizzly bears, moose and elk.

Kelly Torrens, vice-president of product at international tour company Kensington Tours, described western Canada as a bucket-list destination. But the company now has 49 trips that were supposed to pass through Jasper this season in limbo. Six others were forced to evacuate the park when the fire hit.

Parks Canada has cancelled all camping reservations within Jasper National Park until Aug. 6 and with potentially 50% of the town's structures destroyed by fire, the cleanup and rebuild could take years.

Halpenny is among those hedging their bets.

"I've booked a campsite stay in the mountain parks but at the same time, I booked a campsite out on the prairie somewhere and that's my backup plan because I don't want to miss out on my vacation with my family."