Saudi Arabia’s economy shrank 3% in the first quarter due to the decline in oil

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The Saudi Statistics Authority said today, Monday, that the Kingdom’s economy shrank in the first quarter of this year by 3% compared to the same quarter of last year, driven by a sharp decline in the oil sector.

the details

The contraction rate in the first quarter is the best since the start of the Corona crisis, despite the oil sector’s decline by 11.7% in the same period, which is the worst performance of the sector since the beginning of 2020, according to the statistics authority.

The final first quarter figures are relatively better than the preliminary data announced by the Saudi Statistics Authority last May, which stated that the contraction amounted to 3.3%, while oil fell 12%.

oil dip

The Statistics Authority had said in its previous statement on the preliminary data that “the significant negative growth witnessed by oil activities, was due to the reduction in crude oil production levels agreed upon by the OPEC + group since May 2020”.

And Saudi Arabia, with the OPEC + oil exporting group, had agreed to reduce production, starting in May 2020, in order to confront the collapse in prices as a result of the decline in demand with the outbreak of the Corona virus, before returning to gradually increase production.

A statement by the Statistics Authority today stated that the non-oil sector achieved a positive growth of 2.9% in the first quarter, as a group of activities achieved good growth rates such as refining, manufacturing industries, real estate, construction and financial services.

The value of the gross domestic product in Saudi Arabia amounted to 706.4 billion riyals (188.4 billion dollars) in the first quarter of this year, according to the statement.

The evolution of the rate of deflation since the beginning of 2020

(according to the data of the Statistics Authority)

2021

First Quarter: – 3%

2020

Fourth Quarter: -3.9%

Third Quarter: -4.6%

Second Quarter: -7%

First Quarter: -1%

Annual growth rates in Saudi Arabia over 5 years

(according to the data of the Statistics Authority)

2020: -4.1 %

2019: 0.33 %

2018: 2.43 %

2017: -0.74 %

2016: 1.67 %

(Prepared by Abdel Qader Ramadan and Abdel Qader works on the Masrawy Al-Masry website, as he previously worked in several institutions, including the Thomson Reuters Foundation’s Aswat Masriya website, the Egyptian Stock Exchange, and the Egyptian CBC satellite channel)

(Little: [email protected])

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