Saudi Arabia Revises Growth Outlook for 2023 and 2024

Saudi Arabia, the Arab world’s largest economy, has revised its growth forecast for 2023 and expects to record a budget deficit this year as it boosts spending to achieve its diversification ambitions. The kingdom expects real gross domestic product to grow by 0.03 per cent this year, “due to a voluntary reduction in oil production”, compared with a previous growth estimate of 3.1 per cent. However, growth is expected to accelerate to 7.6 per cent in 2022 and level out at 3.8 per cent and 3.0 per cent in 2023 and 2024, respectively.

The revised growth outlook reflects Saudi Arabia's commitment to the OPEC+ agreement, which aims to stabilize the global oil market and support oil prices amid the Covid-19 pandemic. Saudi Arabia has been cutting its oil production by 0.4 million barrels per day since July 2021, which has reduced its oil revenues but also helped to balance the supply and demand of crude oil.

Despite the lower oil income, Saudi Arabia has increased its spending to support its economic recovery and diversification goals. The government plans to spend SAR 1,114 billion in 2023, with a focus on promoting economic growth and improving spending efficiency. The government also remains committed to spending on education, healthcare and social development, which are key pillars of its Vision 2030 agenda.

One of the untapped opportunities that Saudi Arabia is pursuing is the tourism sector, which has been severely affected by the Covid-19 pandemic but also holds great potential for growth and job creation. The government has launched several initiatives to boost domestic and international tourism, such as easing visa requirements, developing new attractions and cultural sites, and investing in infrastructure and hospitality. The tourism sector is expected to contribute 10 per cent of GDP by 2030, up from 3.5 per cent in 2019.

Another promising sector that Saudi Arabia is developing is manufacturing, which can help reduce its dependence on oil exports and create more value-added products and services. The government has been supporting the industrial sector through various programs, such as offering incentives, facilitating access to finance and markets, and enhancing skills and innovation. The manufacturing sector is expected to grow by 5.8 per cent annually until 2030, creating more than 500,000 jobs.

In conclusion, Saudi Arabia has revised its growth outlook for 2023 and 2024 as it increases its spending to achieve its economic diversification objectives. The kingdom is exploring new opportunities in the tourism and manufacturing sectors, which can help create more jobs, increase non-oil revenues, and improve the quality of life for its citizens.

References:

: [Saudi Arabia revises growth forecast for 2023 and 2024 as spending rises](https://www.msn.com/en-ae/money/news/saudi-arabia-revises-growth-forecast-for-2023-and-2024-as-spending-rises/ar-AA1hvIjT)

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: [Saudi Arabia revises growth forecast for 2023 and 2024 as spending ...](https://article.wn.com/view-bitchute/2023/10/01/Saudi_Arabia_revises_growth_forecast_for_2023_and_2024_as_sp/)

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