Saudi economy to exhibit strong growth in 2022 as pandemic diminishes: report

The Saudi Economy in 2022 report foresees overall GDP growth of 7.7 percent in 2022. 

Considering the high demand for oil triggered by a continued recovery in the global market, oil sector GDP is expected to rise by 15.5 percent year-on-year.

The report also predicts the expansion of all sectors of the non-oil economy in 2022. 

A reversal in social distancing restrictions could boost the wholesale and retail, and restaurants and hotels sector. 

Moreover, the rise in Umrah and Hajj pilgrims will drive growth in the transport, communication, and storage sectors. 

Concerns are raised for the construction sector, which may face some labor and supply chain issues in 2022.

 However, the large value of the Public Investment Fund, PIF, and central government projects that are currently in the execution stage would boost the growth of this segment. 

The manufacturing sector will also contribute to non-oil growth, as improvements in global trade coupled with investment in domestic industrial programs help push exports higher than the record levels seen last year. 

The finance, Insurance, and business services sector is also expected to witness healthy growth in 2022. 

According to the report, the community, social, and personal services sector will benefit from the implementation of a National Sports Strategy, while the electricity, gas, and water sector will benefit from an ambitious National Renewable Energy Program. 

Overall, the report predicts the non-oil sector registering a rise of 3.4 percent growth in 2022. 

It also foresees prices rising by 1.7 percent year on year, as higher levels of inflation seen in many developed economies do not fully transmit into the local economy.