IMF Raises Saudi Arabia's 2025 Growth Forecast to 4%

Strategic Insights -

The International Monetary Fund (IMF) has increased its 2025 growth forecast for Saudi Arabia, citing improvements in the non-oil manufacturing sector and the Kingdom's continued participation in gradual OPEC+ production cuts. Saudi Arabia's economy has demonstrated strong resilience to shocks, with non-oil economic activities expanding, inflation contained, and unemployment reaching record-low levels. The Saudi Finance Ministry has forecasted real GDP growth of 4.4% in 2025, driven by the growth of non-oil activities.

Key Takeaways:

  • The IMF has increased its 2025 growth forecast for Saudi Arabia to 4%, its second upward revision in three months.
  • The Kingdom's non-oil manufacturing sector has made notable improvements, contributing to the growth forecast.
  • Saudi Arabia's GDP growth in the second quarter of 2025 was 3.9%, driven by non-oil sectors, with non-oil activity growing by 4.6% compared to the same quarter last year.
  • The Saudi economy grew across all sectors, with oil up 3.8% and government activities growing 0.6%.
  • Sectors like electricity, gas, and water showed the highest growth, followed by finance, insurance, and business activities.
  • The IMF's 2025 Article IV Consultation highlighted the Saudi economy's strong resilience to shocks, with non-oil economic activities expanding, inflation contained, and unemployment reaching record-low levels.
  • Saudi Arabia's Finance Ministry forecasted real GDP growth of 4.4% in 2025 and 4.6% in 2026, driven by non-oil activities.
  • IMF mission chief for Saudi Arabia Amine Mati attributed the Kingdom's economic outlook improvement to resilience in facing global challenges and improved oil revenues and non-oil activities.

Statistics:

  • IMF's 2025 GDP growth forecast for Saudi Arabia: 4%
  • Saudi Finance Ministry's 2025 GDP growth forecast: 4.4%
  • IMF's 2026 GDP growth forecast for Saudi Arabia: 4%
  • Saudi GDP growth in the second quarter of 2025: 3.9%
  • Non-oil activity growth in the second quarter of 2025: 4.6%
  • Highest growth sectors: electricity, gas, and water (8.1%), followed by finance, insurance, and business activities (5.3%)

Sources:

  • International Monetary Fund (IMF)
  • Saudi Finance Ministry
  • Saudi General Authority for Statistics
  • International Monetary Fund's World Economic Outlook report
  • Saudi Research and Publishing Co.