RIYADH, Saudi Arabia, 26 October 2023: In its inaugural Saudi Economy Watch report, PwC revealed that Saudi GDP exceeded USD 1 trillion with strong progress towards meeting its Vision 2030 targets in multiple areas.

Making the announcement through a Press release, PwC said Saudi Arabia’s non-oil private sector is leading in growth for 2023, having accelerated to 5.8% year-on-year (y/y) in Q2 2023 and standing 13.9% higher than in 2019. In contrast, PwC added growth in the non-oil government sector slowed to 3.8% (y/y), while the oil sector contracted by -4.3% (y/y) due to production cuts.

According to PwC, the report reviews Saudi Arabia’s ongoing performance across several economic targets at the midpoint towards achieving Vision 2030’s transformative impact on society and the economy. This positive outcome, PwC said, is attributed to strong investment from the private and public sectors, non-oil revenue growth, ongoing diversification, and economic resilience efforts.

The report, PwC said, indicates notably strong performance on multiple targets. PwC said female workforce participation has surged to 36% in Q1 2023, already ahead of the 2030 target of 30%, supported by social liberalisation and Saudisation policies. The resulting boost to household incomes, PwC added, has been a critical factor in rising consumption, supporting broader economic growth.

Furthermore, PwC said homeownership among Saudi nationals expanded from a baseline of 47% to 67% – scoring higher than the US and France, and these strong results can be attributed to a range of initiatives to boost the supply of affordable homes, including a tax on undeveloped urban land and improved access to finance, with the 2030 target of 70% now close to being achieved.

PwC also said that economic diversification initiatives are bearing fruit, owing to the commitment of the public sector to major non-oil investments. Non-oil revenues, PwC said, have grown by two and a half times the baseline, increasing from a baseline of USD 163 billion to USD 411 billion in 2022, and are expected to further increase by 11% this year.

Moreover, PwC said the transformation of the Public Investment Fund (PIF) from a small holding company to an international dealmaker and manager of giga projects has been one of the biggest successes of the diversification strategy. PIF, PwC added, is on track to achieve its ambitious target to increase assets under management by more than 10-fold, having already increased by nearly five-fold to USD 773 billion by the end of 2022.

Riyadh AlNajjar, Chairman of the Board, Middle East and Senior Partner, Saudi Arabia, said: “Saudi Arabia as a whole is making good progress towards achieving Vision 2030, with areas of focus including non-oil diversification, improving infrastructure, advancing digitalisation, fostering a competitive business environment and ensuring good jobs for its citizens through nationalisation targets. Moreover, Saudi Arabia’s ambitious initiatives are shaping the foundation of the country’s new  economy, which will have a transformative effect on the business environment in the region.”

According to PwC, the report highlights that Saudi Arabia has quickly secured the recovery of the non-oil sector post-COVID, even in the hardest-hit sectors of hospitality, transportation and retail and wholesale trade. As a result, PwC said Saudi GDP exceeded USD 1 trillion for the first time in 2022.

Furthermore, PwC said the ongoing success of these economic initiatives has resulted in Saudi Arabia rising to 17th place in the global economy rankings, with the largest by size of GDP in 2022, and it is now targeting 15th place by the end of this year. The International Monetary Fund (IMF), PwC said, has forecasted that the Kingdom can reach USD 1.3 trillion in fiscal revenue by the end of 2028.

Faisal Alsarraj, Partner, Saudi Arabia and Deputy Country Leader, PwC Middle East, said: “Saudi Arabia’s economy has shown exceptional growth since the launch of Vision 2030. New initiatives and the commitment to its transformation beyond Vision 2030 will provide a secure economic foundation for future generations.”

PwC said that PwC Saudi Economy Watch – Vision 2030, on track at the halfway mark, can be read here.