Saudi Arabia’s non-oil private sector continues to grow solidly in December, PMI Reuters shows
(Reuters) – Strong demand fueled growth in Saudi Arabia’s non-oil business sector in December, albeit at a slightly slower pace than the previous month, a survey showed on Sunday.
Saudi Arabia’s Riyad Bank’s seasonally adjusted purchasing managers’ index (PMI) fell to 58.4 in December from a 17-month high of 59.0 in November. Despite the decline, the headline PMI remained well above the 50.0 mark, which indicates growth.
New orders continued to rise, marking the fifth consecutive month of acceleration, driven by strong domestic demand and an increase in exports. The sub-index rose to 65.5 in December from 63.4 the previous month, and the pace of growth was the fastest recorded in 2024.
“Saudi Arabia’s non-oil private sector ended 2024 on a high, reflecting the successful strides made under Vision 2030,” said Naif Al-Ghaith, chief economist at Riyad Bank, referring to the country’s ambitious program to diversify the economy.
Cost pressures remain a concern, with input prices rising sharply due to high demand for materials. However, wage inflation has eased, which has helped moderate overall costs.
Business expectations improved to a nine-month high in December, and companies are optimistic about continued growth in 2025.
Non-oil GDP is expected to grow by more than 4% in 2024 and 2025, driven by substantial improvements in business conditions, Al-Ghaith added.
The Saudi government plans to increase strategic spending on major projects to meet its Vision 2030 goals, especially the short-term elements. Last month, the kingdom was officially announced as the host country for the 2034 FIFA World Cup.
