Standard & Poor’s: Completed NEOM will reduce oil GDP to 24% of Saudi Arabia’s total GDP

Standard & Poor’s expects Saudi Arabia’s non-oil GDP to continue to grow strongly, supported by a boom in consumer spending, tourism and construction as a result of Vision 2030 projects.

S&P also expects that with the completion of the NEOM project, oil GDP will fall to 24% of the total by the end of 2030, after it accounted for 35% in 2017, when the vision reforms began.

If NEOM’s budget is cut in half, the oil sector’s share of the economy will then be 26%.

As for beyond 2030, and after the completion of major projects, S&P said that increasing labor productivity will be the main influence on long-term economic growth prospects, as well as further economic diversification.

Earlier, Standard & Poor’s expected Saudi Arabia’s real GDP to grow by 2.2% in 2024, rising to 5% in 2025. It said that the growth of the non-oil economy will contribute an increasing share of this growth, thanks to government-led investments in the “Vision 2030” projects.