This week an analysis of the 1st quarter 2015 Saudi economic growth data was released by Jadwa Investment firm in Riyadh. Based on the Saudi Central Department of Statistics and Information it noted the economy was 2.4 percent larger that quarter than in the same quarter of 2014. Last month the International Monetary Fund (IMF) consultation team in Saudi Arabia provided its staff report forecasting Saudi GDP growth “at a healthy 3.5 percent this year, unchanged from 2014, with an increase in oil production and continued government spending expected to support the economy.”
Today we are pleased to provide the Jadwa Investment 2015Q1 GDP report for your consideration and note the full report (complete with graphs) can be accessed at the link.
Quarterly GDP update: Oil sector pushes up overall growth in Q1-15
In real terms, the Saudi economy was 2.4 percent larger in the first quarter of 2015 than in the same quarter of 2014. Year-on- year growth accelerated for the first time in four quarters.
The acceleration was mainly attributed to the oil sector, which grew following two consecutive quarterly declines.
We assume that year-on-year economic growth will reach similar levels in the second quarter owing to continued growth in oil production. Other sectors of the economy should continue to benefit from solid local fundamentals.
The Central Department of Statistics and Information (CDSI) has released GDP data for the first quarter this year showing a real economic growth of 2.4 percent compared with 1.6 percent in the fourth quarter last year and 6.4 percent in the first quarter of 2014. In fact, growth reversed a slowing trend featured in the last three consecutive quarters. The reversal was mainly due to an increase in oil sector growth, which benefitted from elevated levels of oil production during the first quarter. In addition, all sectors of the non- oil economy grew, with the exception of the electricity, gas, and water sector. While the oil sector reversed its negative contribution towards overall GDP growth to reach 0.8 percentage points (ppt) (Figure 1), the private non-oil sector was once again the main growth driver in the first quarter contributing 1.3ppt. The government contribution improved to 0.5ppt in the first quarter compared with 0.2ppt in the previous quarter.