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Non-Oil Activity Powers Saudi Economic Expansion  

The King Abdullah Port, Saudi Arabia. (Asharq Al-Awsat)
The King Abdullah Port, Saudi Arabia. (Asharq Al-Awsat)
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Non-Oil Activity Powers Saudi Economic Expansion  

The King Abdullah Port, Saudi Arabia. (Asharq Al-Awsat)
The King Abdullah Port, Saudi Arabia. (Asharq Al-Awsat)

Saudi Arabia’s non-oil economy continued to power growth in the second quarter of 2025, cementing its role as the main engine of expansion as the Kingdom pushes ahead with efforts to diversify away from hydrocarbons.

The economy grew 3.9% year on year in the quarter, lifted largely by non-oil activities that contributed 2.6 percentage points to overall growth, data from the General Authority for Statistics showed on Monday.

Non-oil GDP rose 4.6% in the three months to June, marking the sixth consecutive quarter of positive expansion. The sector accounted for half of Saudi output for the first time in 2023, a milestone under the government’s diversification agenda.

Oil GDP increased 3.8% in the second quarter, while government activities rose 0.6%. On a quarterly basis, seasonally adjusted GDP grew 1.7%, driven mainly by a 5.6% rebound in oil activity. Non-oil GDP expanded 0.8% from the first quarter, while government activity fell 0.8%.

Saudi crude production climbed 6% year on year in June to 9.36 million barrels per day after OPEC+ boosted output from April, the data showed.

Private sector boost

Economists said the sustained non-oil momentum underscored Riyadh’s commitment to economic diversification and resilience against oil price swings.

“The fifth straight quarter of non-oil growth is a strong sign of the success and sustainability of diversification away from oil market volatility,” said Fahd bin Jumaa, a former Shura Council member and economist. He told Asharq Al-Awsat that non-oil activity has become a “core driver” of growth in line with the Vision 2030 plan.

The rebound in oil alongside steady non-oil expansion reflects “successful diversification” and tangible progress in Saudi targets, supported by heavy government efforts to empower the private sector as a key partner, he said.

Investment push

Economic researcher Fadwa al-Buwardi said the non-oil sector’s performance highlighted the government’s focus on developing new industries and attracting capital.

“The continuous growth of non-oil activities shows the economy’s ability to shift towards more resilience and sustainability, with less dependence on oil and stronger local and foreign investment,” she told Asharq Al-Awsat.

She added that benefits include job creation across multiple sectors, higher GDP, improved non-oil exports and stronger capital inflows. Sustained balance, she said, sends positive signals on liquidity and future investment opportunities, especially given rising foreign inflows.

Outlook

Analysts say the performance reinforces confidence that Saudi Arabia is on track to meet Vision 2030 targets. Non-oil strength, alongside investment inflows and private sector expansion, not only reflects successful diversification, but also signals to global markets that the Kingdom’s economy is becoming more resilient to shocks.

With continued momentum in both domestic and foreign investment in non-oil industries, Saudi Arabia is positioning itself as a regional economic powerhouse capable of building a more sustainable and diversified future.

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Business

IMF Sees Signs of US Economic Strain but Lack of Data Due to Shutdown Clouds Picture

International Monetary Fund (IMF) Managing Director Kristalina Georgieva speaks during a meeting with South Korean President Lee Jae Myung on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in Gyeongju on October 31, 2025. (Photo by JUNG YEON-JE / POOL / AFP)
International Monetary Fund (IMF) Managing Director Kristalina Georgieva speaks during a meeting with South Korean President Lee Jae Myung on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in Gyeongju on October 31, 2025. (Photo by JUNG YEON-JE / POOL / AFP)
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IMF Sees Signs of US Economic Strain but Lack of Data Due to Shutdown Clouds Picture

International Monetary Fund (IMF) Managing Director Kristalina Georgieva speaks during a meeting with South Korean President Lee Jae Myung on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in Gyeongju on October 31, 2025. (Photo by JUNG YEON-JE / POOL / AFP)
International Monetary Fund (IMF) Managing Director Kristalina Georgieva speaks during a meeting with South Korean President Lee Jae Myung on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in Gyeongju on October 31, 2025. (Photo by JUNG YEON-JE / POOL / AFP)

The International Monetary Fund is seeing signs of strain in the US economy with fourth-quarter growth likely decelerating from previous forecasts, but a lack of data due to the government shutdown has clouded its ability to assess US economic performance, IMF spokesperson Julie Kozack said on Thursday.

Kozack told a regular news briefing that the IMF has delayed its annual "Article IV" policy consultations with US authorities because the shutdown prevented preparatory work, with rescheduled timing not yet set.

"The US economy has proven to be resilient in the past few years. We do now see strains starting to mount," Kozack said. "Domestic demand has been moderating, and job growth is slowing. The combination of slowing immigration inflows, tariffs, broader policy uncertainty have been weighing on activity."

She said that there would be a negative impact on U.S. growth in the fourth quarter due to the record 43-day partial government shutdown, and the rate would likely be below the IMF's previous forecast of 1.9% issued in October.

Kozack added, however, that this effect would likely be reversed in the first quarter of 2026, in line with the end of previous US government shutdowns.

But the lack of accurate economic data since October 1 "has recently complicated our ability to assess the state of the US economy and to undertake our preliminary work for the Article IV consultation," Reuters quoted Kozack as saying

She repeated the IMF's view that US inflation is on a path to return to the Federal Reserve's 2% target, but tariffs have increased upside risks to inflation while slowing job growth further complicates the Fed's monetary policy choices.

"So the Fed has appropriately lowered the policy rate in recent months," Kozack said. "We see caution needed going forward as the Fed balances these two factors of sort of upside risk to inflation and downside risk to the job market."

The IMF still views inflation expectations in the US as being "well anchored," she said, but noted that while the rate of price increases has slowed, the higher level of prices "is causing pain in certain segments of society."

Asked about the implications of the Trump administration's boycott of a G20 leaders summit in South Africa on November 21-23, Kozack said that the forum remains an important platform for the world's biggest economies to "pool expertise to solve shared problems."

IMF Managing Director Kristalina Georgieva is scheduled to attend the summit after meetings in Angola with government authorities.

US Treasury Secretary Scott Bessent participated in a G20 finance leaders meeting in October during IMF and World Bank annual meetings and helped deliver a joint G20 declaration to keep working on debt vulnerabilities.

"So this was an important outcome of that G20 meeting, and we do expect, going forward, that the topic of debt will remain a priority under the upcoming US G20 presidency," Kozack said.

Washington takes over the G20 presidency in 2026 with a planned leaders summit in Miami.

Business

IMF to Start Mission to Ukraine Soon, Stresses Need for Anti-corruption Efforts

An aerial view shows the town of Myrnohrad, Ukraine in this screengrab from a video released November 12, 2025 and obtained by REUTERS.
An aerial view shows the town of Myrnohrad, Ukraine in this screengrab from a video released November 12, 2025 and obtained by REUTERS.
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IMF to Start Mission to Ukraine Soon, Stresses Need for Anti-corruption Efforts

An aerial view shows the town of Myrnohrad, Ukraine in this screengrab from a video released November 12, 2025 and obtained by REUTERS.
An aerial view shows the town of Myrnohrad, Ukraine in this screengrab from a video released November 12, 2025 and obtained by REUTERS.

The International Monetary Fund will soon begin a staff mission to Ukraine to discuss its financing needs and a potential new lending program, spokesperson Julie Kozack said on Thursday, underscoring the need for continued anti-corruption efforts in the war-torn country.

Ukrainian Prime Minister Yuliia Svyrydenko on Thursday announced an audit of all state-owned companies, including in the energy sector, following an alleged $100 million corruption scandal that has led to the suspension of two cabinet ministers.

Anti-corruption authorities said this week they had detained five people and identified two others still at large suspected of involvement in the alleged plot to control procurement at nuclear agency Energoatom and other state enterprises, Reuters reported.

Ukraine is in talks with the IMF about a new four-year lending program for the country that would replace the current four-year $15.5 billion program. Ukraine has already received $10.6 billion of that amount.

Kozack told reporters at a regular briefing that the IMF staff mission would center on policies to safeguard Ukraine's macroeconomic stability and ensure its debt sustainability, with a focus on reforms to promote domestic revenue mobilization and to strengthen governance and combat corruption.

"We've been saying for some time that Ukraine needs a robust anti-corruption architecture to level the playing field, safeguard public resources, improve the business climate and attract investment," Kozack said, calling efforts to fight corruption a central requirement for Ukraine's donors.

"The most recent uncovered evidence of corruption in the energy sector ... highlights the importance of pressing forward with anti-corruption efforts in Ukraine and ensuring that the anti-corruption institutions have the capacity, trust and freedom to go about their duties," she said.

Kozack said the IMF was closely monitoring discussions that Ukrainian authorities were having with creditors, although it is not party to the discussions themselves.

She said the IMF team visiting Ukraine would liaise with Ukraine's international partners to identify the appropriate financing vehicles to support the country, now in its fourth year of fighting Russia's invasion.

That would include ensuring that any new financing is on "terms consistent with Ukraine's overall debt sustainability," she said, when asked about concerns raised by Ukraine's GDP warrant holders last week about another debt restructuring.

Warrant holders last week said they wanted a "claim reinstatement mechanism" as part of any new bonds they accepted as part of Kyiv's long-sought restructuring of the debt instruments.

Ukraine needs a new IMF program since the one agreed on in 2023 assumed the war would end in late 2025, a prospect that is still not in sight.

As was the case in 2023, Western countries will have to offer assurances to guarantee the IMF loan since the Fund normally does not lend to a country at war.

Business

First Direct European Flight Lands at Red Sea International Airport

The Red Sea destination currently includes nine luxury hotels welcoming guests, in addition to the exclusive Thuwal Private Resort off the coast of Jeddah - SPA
The Red Sea destination currently includes nine luxury hotels welcoming guests, in addition to the exclusive Thuwal Private Resort off the coast of Jeddah - SPA
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First Direct European Flight Lands at Red Sea International Airport

The Red Sea destination currently includes nine luxury hotels welcoming guests, in addition to the exclusive Thuwal Private Resort off the coast of Jeddah - SPA
The Red Sea destination currently includes nine luxury hotels welcoming guests, in addition to the exclusive Thuwal Private Resort off the coast of Jeddah - SPA

Red Sea Global announced the arrival of the first direct European flight to Red Sea International Airport, marking a new strategic milestone in the development of Saudi Arabia’s tourism sector and its global connectivity, in alignment with the goals of Saudi Vision 2030.

According to a press release issued by the Red Sea Global on Thursday, the inaugural flight departed from Milan, Italy, establishing a direct air link between Europe and Saudi Arabia’s Red Sea coast, SPA reported.

This new route enables European travelers to easily access the Red Sea and AMAALA destinations, and enjoy luxurious, nature-immersive experiences—whether aboard Beond’s premium aircraft or through the world-class facilities at Red Sea International Airport, designed to reflect the local environment.

The release added that the route was officially launched during a signing ceremony held as part of the TOURISE Global Tourism Summit in Riyadh, reflecting the strong collaboration between partners driving a new era of luxury travel to the Kingdom.

On this occasion, Group Chief Executive Officer of Red Sea Global John Pagano stated: "The launch of the direct Milan route marks a pivotal moment in our journey toward a more globally connected future. It reflects our commitment to offering exceptional luxury tourism experiences rooted in innovation."

The Red Sea destination currently includes nine luxury hotels welcoming guests, in addition to the exclusive Thuwal Private Resort off the coast of Jeddah.

Earlier this week, the company unveiled the AMAALA destination, which will open six world-class luxury resorts in its first phase, alongside a yacht club, the Coralium Marine Life Institute, a state-of-the-art marina, and a vibrant marina village in the coming weeks.