Saudi Arabia’s non-oil exports, including re-exports, continued their steady rise, increasing by 18.1% year-on-year in December, reaching SAR 29 billion ($7.7 billion). Non-oil exports, excluding re-exports, also saw a 15.9% increase.
According to data released by the General Authority for Statistics (GASTAT) on Tuesday, oil exports declined by 10% in December, with their share of total exports dropping from 74.3% in December 2023 to 68.8% in 2024.
The data also showed that Saudi Arabia’s trade surplus shrank by 56.1% year-on-year in the last month of 2023.
Two key factors contributed to the pressure on the trade balance: a 27.1% increase in commodity imports to SAR 79 billion year-on-year and a 2.8% decline in total exports to SAR 94 billion.
Saudi Arabia’s oil revenues have been steadily decreasing due to voluntary production cuts in line with OPEC+ decisions aimed at maintaining market stability.
- Diversifying Income Sources -
Experts attribute the rise in non-oil exports to improvements in airport, port, and road infrastructure, along with continuous support for the private sector. They affirm that Saudi Arabia is on the right track to becoming a global logistics hub.
Speaking to Asharq Al-Awsat, experts highlighted that the government is implementing strategies to diversify national income sources, making the growth of non-oil exports a key pillar in achieving the country’s economic objectives in the coming years.
Dr. Mohammed Makni, Professor of Finance and Investment at Riyadh’s Imam Mohammad Ibn Saud Islamic University, told Asharq Al-Awsat that the increase in non-oil exports reflects the government’s commitment to this sector as part of its broader strategy to diversify Saudi Arabia’s economy.
He noted that since early last year, the Kingdom has been achieving record numbers in non-oil exports, which grew by approximately 17% compared to 2023. This growth aligns with efforts to increase the share of non-oil exports to 50% by 2030.
- Petrochemicals Sector -
Makni also underscored the importance of establishing the Saudi Export Development Authority, which focuses heavily on expanding non-oil exports.
Saudi Arabia’s strength in this sector is largely driven by petrochemicals, which account for around 30% of total non-oil exports, he noted. This dominance is due to the Kingdom’s strong position in energy and oil production, making petrochemicals a natural extension. Other significant contributors include the rubber industry and other manufacturing sectors.
He further explained that government support for the non-oil sector—through investment packages, commercial chambers, and assistance for exporters—has boosted competition and contributed to the country’s goal of economic diversification.
- Encouraging Investments -
Meanwhile, legal expert and commercial law professor Dr. Osama Al-Obaidi told Asharq Al-Awsat that the rise in non-oil exports is largely due to increased chemical exports—one of the most significant non-oil sectors—along with the export of plastics, rubber, and related products.
The higher re-export rates for the month contributed to the overall increase in non-oil exports, he said.
This growth reflects the Saudi government’s extensive efforts to diversify the economy and reduce reliance on oil as a primary revenue source, in line with Vision 2030, he stressed. These efforts include promoting both foreign and domestic investments and stimulating non-oil sectors such as industry, trade, mining, and tourism, in addition to supporting small and medium-sized enterprises (SMEs).
He attributed the rise in non-oil exports to improvements in the infrastructure of airports, ports, roads, and warehouses used in export operations. This is part of Saudi Arabia’s strategy to position itself as a global logistics hub connecting the world’s continents. Enhancements in production processes, product quality, supply chain efficiency, and export facilitation have also played a crucial role.
- Purchasing Managers’ Index (PMI) Performance -
Dr. Naif Al-Ghaith, Chief Economist at Riyad Bank, told Asharq Al-Awsat that the latest Riyad Bank Purchasing Managers’ Index (PMI) reading showed an unprecedented boom in the non-oil sector, surpassing 60.5. This strong performance highlights the growing role of the private sector in bolstering the national economy—fully aligned with Vision 2030 goals to diversify economic foundations and reduce dependence on oil as the primary income source.
According to Al-Ghaith, this growth has been accompanied by a rise in imports, particularly in machinery, equipment, and metals, reflecting Saudi Arabia’s strategy to develop and modernize its industrial sector.
However, despite these positive developments, the trade surplus in goods narrowed by 52.4% in Q4 2023 compared to the same period in the previous year, underscoring the need to strengthen national exports to maintain trade balance.
He added that Saudi Arabia is rapidly advancing its position as a regional and global economic power by fostering an attractive investment environment and strengthening international partnerships. These efforts are part of the broader strategy to achieve sustainable and balanced economic growth, while expanding the role of the private sector in the national economy.
