Saudi non-oil economy recorded a 3.3% growth at the end of last year; With the overall growth of 0.3% during 2019, according to the Saudi General Authority for Statistics.
The total economic growth was below expectations; however, the contraction of the oil sector was remarkably noticeable. This is with the non-oil sector increasing its contribution to reaching 3.3%. As the Saudi government aims to increase the private sector's contribution to the country's GDP.
Saudi Arabia is working hard to boost the private sector and diversify its economic resources instead of relying on oil. This is despite the decline in oil prices and production cuts that came in agreement with OPEC+.
The Authority said on Sunday that expansion in the non-oil sector was driven mainly by growth in the private sector, which amounted to 3.8%.
Chief economist at Abu Dhabi Commercial Bank, Monica Malik, believes that non-oil activity expanded at the fastest pace since 2014 thanks to a strengthening in non-oil growth.
"We believe that higher investment growth will remain a key support factor for non-oil activity in 2020 with greater progress with key projects."
In 2019, various sectors such as financial, insurance, corporate services, retail, restaurants, and hotels witnessed the highest growth rate in line with the government's interest in investing in areas such as tourism and entertainment, while the energy and industrial sector contracted.
Saudi exports declined 10.4% year on year due to a 14% drop in oil exports.
Earlier, governor of the SAMA, Ahmed al-Khulaifi, confirmed that the non-oil sector will support the Kingdom's economic growth this year. Despite its suffering, which may be exacerbated by the global spread of the coronavirus.
Saudi Arabia announced Thursday a ban on foreigners coming to the kingdom for the Umrah pilgrimage. Besides, tourists from at least 25 countries where the virus has been found.
Hajj and Umrah visits, namely to Makkah and Madinah generate revenues in Saudi Arabia. The two cities are the backbone of the Kingdom's plans to increase visitor numbers within the ambitious economic reform program.