Industrial Production increases by 24% in May 2022

In May 2022, the Industrial Production Index (IPI) increased by 24% compared to May 2021. The IPI continued to show positive growth rates due to the high production in the three sub-sectors mining & quarrying, manufacturing, and electricity & gas supply.

Recovery in the Industrial Production sector In May 2022, the year-on-year growth rate of the Industrial

Production Index (IPI) was 24%, which is the third highest rise in the last three years. Taking a longer-term view, growth of the IPI turned positive in May 2021 after a long period of negative growth rates in

2019 and 2020, partly impacted by the effects of the worldwide pandemic. Since mid-2021, the IPI growth showed a positive trend, accelerating at the end of 2021 to now.

Mining and quarrying are the main drivers of the IPI

The relative weights of the mining and quarrying, manufacturing and electricity and gas supply sectors in the IPI are 74.5%, 22.6% and 2.9%, respectively. Thus, the trends of the industrial production index in the mining and quarrying sector dominates the trend in the general IPI.

In May 2022 mining and quarrying grew by 23.3% compared to May 2021 as Saudi Arabia increased its oil production to its highest level by more than 10 million barrels per day in May 2022. The manufacturing activity also increased by 28.8% compared to the same month of the previous year, the electricity and gas supplies increased by 3%.

Compared to April 2022, the overall IPI increased by 1.2%. Mining & quarrying showed a month-on-month growth rate of 0.9%. The manufacturing sector increased by 0.2%, electricity & gas supplies increased by 24.9%. The impact of growth in the electricity & gas supplies index on the IPI was limited due to its small weight in the index.